Cash Deposit and Unencumbered House- What are my Options?

edited 30 November -1 at 1:00AM in Mortgages & Endowments
2 replies 580 views
Ronaldo_MconaldoRonaldo_Mconaldo
5.2K Posts
edited 30 November -1 at 1:00AM in Mortgages & Endowments
I paid off the mortgage on my current house back in September, it's worth between £140k-£150k, but niw we want to move to a bigger house spending between £180k-£220k. I have been saving since September and have about £15k in cash at the minute but this increases as the months go by.

Obviously the simplest thing would be to sell our house and then buy another, but do we have other options now that we're mortgage free? I'm not a very good salesman and dread the idea of actually promoting the house to potential buyers plus we've got 2 young kids that we will struggle to hide at short notice (imagine viewing a house while a 5 year old is demanding more Corn Flakes and a 4 month old is crying his head off).

So ideally it would be great to buy a bigger house with the deposit and then sell the old house and paying a big wedge of cash off once it sells, hopefully getting the estate agents to show people around.

Does that sound like a good idea? Is there another option now that I have an unencumbered house? Would a mortgage person take into account that I have XYZ in cash to go but a house on top of that to bring a big payout once sold?

Replies

  • foxy-stoatfoxy-stoat Forumite
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    Put your house on the market, cornflakes an all and look for your next house, you will be in a chain like the majority of house buyers/sellers. If you want to be chain free when you move with a VERY small mortgage, or if you can save up enough, totally cash buyers then sell your place, move into rented for 6-12 months and go house hunting with 100% cash - you will be in a stronger position not being in a chain.

    If you buy a second home without selling the first you will have to pay the higher rate Stamp Duty but you can claim a refund once the first property is sold within 18 months.
  • AnotherJoeAnotherJoe Forumite
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    Arrange an open morning with the EA to show multiple viewers round, and head out to the local pool or play area with the kids.

    I wouldn't want the hassle of moving twice with kids, let alone adding rental issues as well, that could easily eclipse the perils of being in a chain. And you will most likely still end up in a chain anyway, unless you are buying a new build.
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