Size of deposit leverage

TexasBliffEm

Hi all,

I am in negotiations to buy a house (circa £195k). I have used the fact that I have £120k to put down as a deposit (to strengthen my hand in negotiations).

If I were to get my offer accepted - is there anything to stop me putting down £50/60k and taking a mortgage our for the remaining? Is this seen as sneaky or does it not matter so long as the mortgage is approved?

Thanks in advance

Matthew

[Deleted User]

You can put down as large a deposit as you want, as long as the mortgage is approved on that basis.

The vendor doesn't care where the money is coming from, as long as they get it.

ACG

They will not know that you are putting down a smaller deposit (assuming you do not use the estate agents mortgage broker/solicitor).

The agent may ask for proof of deposit however, so if you have it and put down less it should be fine. If you do not have it, then it may get picked up.

AnotherJoe

TexasBliffEm wrote: »

Hi all,

I am in negotiations to buy a house (circa £195k). I have used the fact that I have £120k to put down as a deposit (to strengthen my hand in negotiations).

???????

You "I want £10k off as I have a bigger deposit"
Me "eh!? Why would I care?"

I'd also think that with that strange idea, what else might you come up with later, so I'd avoid you as a buyer unless I had no alternative.

Ps if you have found an equally deluded vendor who thinks this makes a difference, then they will have no idea when the transaction concludes, what proportion of money comes from the lender and what comes from you.

TexasBliffEm

Lol. Cbf biting

David_White

Can't see anything wrong with what you're doing and despite some of the above comments I can actually see the reason behind your logic.

If I was selling a property I'd feel a bit more confident selling to someone with a large deposit than someone with 5%.

Whilst obviously not the only factor, obtaining a mortgage is arguably easier with a large deposit.

TexasBliffEm

Thanks David. Yeah that's what I thought. My position is more attractive to a seller than 5pc deposit. Fear of falling through etc

kingstreet

David_White wrote: »

If I was selling a property I'd feel a bit more confident selling to someone with a large deposit

... so would I, but I wouldn't change the price I'm prepared to accept.

£50k deposit or £120k deposit - both produce a low enough LTV to make me more confident.

David_White

kingstreet wrote: »

... so would I, but I wouldn't change the price I'm prepared to accept.

Totally agree, I wouldn't either....

That said, the unknown variable is how motivated the seller is to move the property.

I think it's reasonable to say that a highly motivated seller would reduce the price a bit if they thought it would be a quick sale.

AnotherJoe

TexasBliffEm wrote: »

Thanks David. Yeah that's what I thought. My position is more attractive to a seller than 5pc deposit. Fear of falling through etc

Is that the Your position ? As you wrote originally, it implied you are looking for reduction in price on the basis of your deposit. Very different to being preferred bidder

Thrugelmir

TexasBliffEm wrote: »

Thanks David. Yeah that's what I thought. My position is more attractive to a seller than 5pc deposit. Fear of falling through etc

You won't be told the position of other prospective buyers though. Odds are that any other buyer will have a better deposit than this.