95% LTV Mortgages

MovingForwards

@FOGGY1974 unless it was a RICS qualified person who valued the property, it's not a valuation it's an estimate as to what an estate agent thinks the property should be marketed at and is then open to potential purchasers to negotiate.

Not all lenders like borrowed money for deposits as that's another reduction on your available money and affects affordability.

Until probate is through the solicitors cannot compete the purchase, not sure what the backlogs are like at the probate courts, but it could be weeks or months before probate is granted, then it could be 3 - 6+ months before the conveyancing is complete.

At least your broker is saying there are some lenders still doing 95% mortgages.

[Deleted User]

There is no requirement to use an estate agent for a probate house. HMRC just need to be sure its valued correctly. At that value thats easily done from past sale figures in the road unless the house is a one off. 

Comms69

FOGGY1974 said:

md258 said:

My guess (with no insider knowledge) is that as the government eases the restrictions, 95% LTV mortgages will become available again.
Is the property currently on the market? If not, you've probably got time, if it is, they won't be able to sell it (except to a landlord) until you leave, which doesn't have to be July if you switch over to a periodic tenancy.

md258 said:

My guess (with no insider knowledge) is that as the government eases the restrictions, 95% LTV mortgages will become available again.
Is the property currently on the market? If not, you've probably got time, if it is, they won't be able to sell it (except to a landlord) until you leave, which doesn't have to be July if you switch over to a periodic tenancy.

Hi md258. 
The property is not on the market as the lady who has power of attorney gave us first refusal. The property has been valued at 185k and she has been told she can get between 180 - 185k. For probate reasons it has been valued at 175k as the kitchen needs updating. She said we can have the house for 175k which is probate value. We did cheekily offer 160k but she said she told us we can have it for 175k. I am not sure she will extend the tenancy as she will want to sell the house as soon as she can. 

You're a tenant? Frankly a strong position.

160k, or no sale for 12 months....

FOGGY1974

MovingForwards said:

@FOGGY1974 unless it was a RICS qualified person who valued the property, it's not a valuation it's an estimate as to what an estate agent thinks the property should be marketed at and is then open to potential purchasers to negotiate.

Not all lenders like borrowed money for deposits as that's another reduction on your available money and affects affordability.

Until probate is through the solicitors cannot compete the purchase, not sure what the backlogs are like at the probate courts, but it could be weeks or months before probate is granted, then it could be 3 - 6+ months before the conveyancing is complete.

At least your broker is saying there are some lenders still doing 95% mortgages.

Hi. I am not sure if the chap who valued the house was RICS qualified, all I know he was from Robert Oulsnams estate agents who we pay our rent to because she uses them as an agent. I have been told we can get a mortgage by the mortgage adviser we are using but need 10% deposit which we can not raise so I just hope when lock down is over they re introduce the 95% LTV mortgages. Just spoken to the landlady and she said it will probably be later than July ( We have a rental agreement till July ) when probate is sorted as the solicitors etc are working from home and are behind with sorting it out. She said we will have to extend the rental agreement and has asked if we want a 6 month extension or just a month by month agreement, we will have to work out what is best. Atleast this will give us more time to save and also get more money into the help to buy isa.

Crashy_Time

steampowered said:

Personally I would not take out a 95% mortgage at the moment. If house prices fall just 5%, then unless you can overpay your mortgage you'll be in negative equity - left unable to move house and paying a rip-off standard variable rate when your initial mortgage term finishes. 

You could:
- Try to negotiate the price down, which will give you a better LTV. As this is a probate sale it's possible that the sellers might be willing to give you a good price if you make it easy for them and are ready to proceed quickly. Realistically they are going to struggle to find a buyer in this climate. 
 - Rent a different property, keep saving and buy somewhere else in a year or two year's time.
- Buy a cheaper property.

Good advice.

Sailtheworld

FOGGY1974 said:

Hi all. I hope you can help. We are saving for a deposit to buy the house we are renting, trouble is I see most banks etc are not doing 95% LTV Mortgages any more. What can we do if we have not got enough deposit for a 80 - 85% LTV mortgage?
The house is currently going through Probate as the current owner passed away, this should be sorted by around July and we have a rental agreement till mid July. 

A smaller deposit puts you at increased risk of negative equity so you need to be reasonably sure you're staying for a while. Also, although strapped for a deposit, try to ensure there's enough cash to try and overpay which will help reduce the risk of negative equity over time. The other thing is that negative equity is absolutely nowhere near as scary as it's made out by the media and Internet forums.

You're actually in a good position. The executors of the estate, if they've got any sense, will realise that an incumbent tenant wanting to buy is quite an attractive proposition and be willing to negotiate a favourable price.

If you can't raise an 80 - 85% deposit right now (and a 95% mortgage isn't available) then maybe the executors would be willing to get into the rental game until you can? Again that might be an attractive proposition - they've been left a house and a monthly income stream. They must be pinching themselves.

You have to be ready to walk though. 

Crashy_Time

Sailtheworld said:

FOGGY1974 said:

Hi all. I hope you can help. We are saving for a deposit to buy the house we are renting, trouble is I see most banks etc are not doing 95% LTV Mortgages any more. What can we do if we have not got enough deposit for a 80 - 85% LTV mortgage?
The house is currently going through Probate as the current owner passed away, this should be sorted by around July and we have a rental agreement till mid July. 

A smaller deposit puts you at increased risk of negative equity so you need to be reasonably sure you're staying for a while. Also, although strapped for a deposit, try to ensure there's enough cash to try and overpay which will help reduce the risk of negative equity over time. The other thing is that negative equity is absolutely nowhere near as scary as it's made out by the media and Internet forums.

You're actually in a good position. The executors of the estate, if they've got any sense, will realise that an incumbent tenant wanting to buy is quite an attractive proposition and be willing to negotiate a favourable price.

If you can't raise an 80 - 85% deposit right now (and a 95% mortgage isn't available) then maybe the executors would be willing to get into the rental game until you can? Again that might be an attractive proposition - they've been left a house and a monthly income stream. They must be pinching themselves.

You have to be ready to walk though. 

The "rental game" is much less attractive than it used to be due to taxation changes, unlikely that anyone would want to go that route, especially at this time, best to just lower the offer IMO.

RyanHello

If I was you OP, i would continue to rent. If you can save a decent amount of money while renting, the ball is in your court. The more you have = the more options you have. 
I personally wouldn't even think about buying a property with the current economic climate... but that's just me!

Sailtheworld

Crashy_Time said:

Sailtheworld said:

FOGGY1974 said:

Hi all. I hope you can help. We are saving for a deposit to buy the house we are renting, trouble is I see most banks etc are not doing 95% LTV Mortgages any more. What can we do if we have not got enough deposit for a 80 - 85% LTV mortgage?
The house is currently going through Probate as the current owner passed away, this should be sorted by around July and we have a rental agreement till mid July. 

A smaller deposit puts you at increased risk of negative equity so you need to be reasonably sure you're staying for a while. Also, although strapped for a deposit, try to ensure there's enough cash to try and overpay which will help reduce the risk of negative equity over time. The other thing is that negative equity is absolutely nowhere near as scary as it's made out by the media and Internet forums.

You're actually in a good position. The executors of the estate, if they've got any sense, will realise that an incumbent tenant wanting to buy is quite an attractive proposition and be willing to negotiate a favourable price.

If you can't raise an 80 - 85% deposit right now (and a 95% mortgage isn't available) then maybe the executors would be willing to get into the rental game until you can? Again that might be an attractive proposition - they've been left a house and a monthly income stream. They must be pinching themselves.

You have to be ready to walk though. 

The "rental game" is much less attractive than it used to be due to taxation changes, unlikely that anyone would want to go that route, especially at this time, best to just lower the offer IMO.

The person who has inherited the property has already found themselves in the rental game. First world problem really - certainly worse things than inadvertently finding yourself the landlord of a free property with a reliable tenant who wants to buy it.

Some basic back of fag packet maths should inform you that lowering the offer doesn't much help the OP. If they've got a 5% deposit but they want the same sum to be a 20% deposit they need to offer 75% less.

sjc93

I really am so tired of the same people coming into these kinds of posts, scaremongering & making people feel like they have no hope with the housing market because apparently they've all got their crystal balls aligned and know exactly what's going to happen with the economy.

I'm going through with my purchase at the moment with a 95% mortgage (5 yr fixed - FTB) that I managed to secure literally a week before lockdown occurred. It's mine and my partners first home and it's in an ideal area, is a jump from what we're at now (2 bed cramped flat to a three bedroom house... and a garden!!) and we've been renting for almost two years; we're fed up of having dead money go towards a BTL when our payments could be going on a home. Our home.

The things that you have to consider (and I'm sure you will!) are the area that you're buying, doing the research on the house prices, if you can afford the monthly mortgage payments realistically, if your job is secure enough at the moment and will be for the forseeable, etc.

I can completely understand how hard it is to be essentially paying all of this money out to live in a property that you don't own and you have no ties to, and also how hard it is to actually save if you don't have the bank of mummy and daddy giving you a generous sum towards the deposit. 

There are places out there that are still advertising 95% mortgages but I doubt they're moving on anything at the moment due to the furloughing and being understaffed. The supply and demand will still be here for buying and selling property; so I'd sit tight, continue to carry on saving like you are and hopefully the 95% mortgages will return (fingers crossed for you!)