Selling house, buying next one but needs work - Mortgage/Financing?

haddock82

Hi All,
Firstly apologies if this is in the wrong section and should be moved to mortgages, secondly apologies if this has been asked a million times before but I couldn't find much help via Google or searching on here!
Situation: Selling first home, looking to buy next house
Our house is on the market and we expect to achieve c.£250,000
Current mortagage has £92,000 outstanding with no penalties for early repayment or porting (Coventry Building Society)
The houses we have looked at to buy next would all require some degree of work, they are all habitable and mortgageable as is but we'd want to look at exensions & renovation works.
I have a mortgage in principle through L&C for up to £158,000
But what I don't know or understand is if we sold our house we'd have circa £158k in equity(?)
Could I keep some of this back for renovations? Say £30,000 and then ask for a mortgage of £158,000?
Or do I have to put all of the proceeds in to the next house?
I think this would limit our purchase price to £286,000 for the mortgage but is this even possible?!
Sorry if this is a simple quesiton! We've not sold before our current home was a first-time buyer situation.
Thanks in advance for any replies!

se2020

Yes you can do whatever you want.
Basically when you sell your house the solicitor will receive the money from the buyers, they will pay off the remainder of the existing mortgage and give what's left to you (less the solicitor fees!)

You can then put however much deposit on the new place as you like just as you did with your first house.
However, a bigger deposit will get you a better rate, you need to have an income to support how much you want to borrow and also some run down places may be harder to mortgage meaning they may ask/insist on a bigger deposit or they may charge higher rates meaning you might be better off putting down a bigger deposit.

se2020

If you sell for 250, pay back 92 you will be left with about 150 after fees etc.
You can also borrow 158 so if you put 120 down you could buy a new place for about 275 plus have some for the fees plus have 30k left for works. Plus any other savings you have at the moment.

If you are selling and buying at the same time then that's what turns the process into a 'chain ' with the resulting problems from that nut might save you a few quid on fees.
Or you could sell yours first and move into rented/family and become a 'proceedable' buyer.
This might give you more options if you wanted to buy a run down property via auction for example. 
Depends if you are buying somewhere so run down it is likely to be empty/estate sale/etc or if they are just going to be part of a chain anyway.
If you do end up with 150k cash to store somewhere for a while just check the protection on the account etc.
The most expensive way is to buy a new place before selling yours so avoid doing that if possible. 

haddock82

Great! Thank you for the replies 

Fees wise, what are the big deductions to look out for?

Estate Agent:
£189 through Doorsteps - No further fees
Mortgage:
£100 exit fee with Coventry Building society
£0 early repayment charge with Coventry Building Society
EPC:
£70 (Already Done)
Conveyancing:
Sale - c.£800
Purchase - c.£800
Building Survey:
c.£600(?)

Anything else I should add in?

Removals we will do ourselves as I have access to a van 

Total: £2559

Sale Price: £250,000
Mortgage: £92,000
Left Over: £158,000
Fees: £2559
Total: £155,441

se2020

I would say the biggest variation to account for would be the sale price (unless 250 is the end figure)
If marketed for 250 expect an opening offer of 225, negotiate up to 240 or so then maybe end up at 235 after the survey etc.

haddock82

se2020 said:

I would say the biggest variation to account for would be the sale price (unless 250 is the end figure)
If marketed for 250 expect an opening offer of 225, negotiate up to 240 or so then maybe end up at 235 after the survey etc.

£250k is the end figure after negotiation, it's on the market higher than this and already have offers around this amount  

hazyjo

You may have access to a van, but can you fit the entire contents of your house into it?

Will you have large items to carry such as beds and mattresses, fridge freezer, washing machine, table and chairs, sofas, etc?

You won't have time to do several trips. If round the corner, maybe 2 trips MAX.

Do not underestimate removals and the time and stress it takes up in a process that's beyond stressful already!

haddock82

Good point, I was thinking of off loading as much as possible to the In-Laws in the coming weeks before the sale, but in reality this will be a pain.

Off to get removal quotes!