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Selling our flat.
gooner85
Posts: 6 Forumite
Hi,
We are in the process of selling a Shared Ownership flat which we have 50% share, we had to obtain a RICS valuation before we sell. (to protect the housing associations 50%)
Anyway, we found a buyer who dragged out the conveyancing process for 8 weeks to then make a demand that we extend the lease which is at 88 years from 99 years (the flat was RICS valued with the lease in mind). This backed us into a because we are keen to make the stamp duty holiday, so we agreed to lower the asking price by £7,000 which we were told by the housing association would come out of our 50%. The flat was valued at £220k full market value £110k for 50% and we finally settled for £103k for 50%.
Today, our buyers stated their broker revised the offer with the lender, they and subsequent lenders have refused to loan them for the flat unless they purchase the flat at the RICS valuation of £110k (basically forcing them into taking the extra £7k debt). The buyers have said they want to proceed at £110k but want us to pay them £7000 in cash on completion.
Our conveyancer wasn't hugely receptive to this idea, saying she's never experienced the buyers paying money backwards to the seller and she would need to check before we agree.
My concern is they would be obtaining a mortgage for the value in £110k, (10% deposit) and then receiving 7k back in cash, seems a little dodgy to me.
Has anyone experience this before? or has anyone transferred money to the buyer before?
Thanks
We are in the process of selling a Shared Ownership flat which we have 50% share, we had to obtain a RICS valuation before we sell. (to protect the housing associations 50%)
Anyway, we found a buyer who dragged out the conveyancing process for 8 weeks to then make a demand that we extend the lease which is at 88 years from 99 years (the flat was RICS valued with the lease in mind). This backed us into a because we are keen to make the stamp duty holiday, so we agreed to lower the asking price by £7,000 which we were told by the housing association would come out of our 50%. The flat was valued at £220k full market value £110k for 50% and we finally settled for £103k for 50%.
Today, our buyers stated their broker revised the offer with the lender, they and subsequent lenders have refused to loan them for the flat unless they purchase the flat at the RICS valuation of £110k (basically forcing them into taking the extra £7k debt). The buyers have said they want to proceed at £110k but want us to pay them £7000 in cash on completion.
Our conveyancer wasn't hugely receptive to this idea, saying she's never experienced the buyers paying money backwards to the seller and she would need to check before we agree.
My concern is they would be obtaining a mortgage for the value in £110k, (10% deposit) and then receiving 7k back in cash, seems a little dodgy to me.
Has anyone experience this before? or has anyone transferred money to the buyer before?
Thanks
0
Comments
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I doubt the lender would be happy with it but wait to see what your conveyancing comes up with.1
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Cashback deals used to be more popular in the past (before lenders got a bit more wary about them). It's more a problem for your buyers (and their solicitors) to somehow satisfy their lenders that buying at £110k less a £7k cashback isn't just a purchase for a net price £103k (even though it clearly is). No real problem for you that I can see. In practice the "cashback" tends to just be a net price paid on completion rather than £7k pointlessly going to and fro the solicitors.1
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"Cashback" is just one of the things from the past that caused you to need SO in the first place!0
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