Using credit card balance to top up cash house purchase

MattMattMattUK

Countrysider said:

The house i'm looking at is un-mortgageable so a small mortgage is not an option.

What makes the house unsuitable for mortgage security? There are brokers on the mortgage forum on here, some deal with the odd and unusual, it would be worth seeing if one of them can help.

Penelopa.Pitstop

I would just take loan and state different purpose when applying. House refurbishment or car purchase.

mcpitman

Penelopa.Pitstop said:

I would just take loan and state different purpose when applying. House refurbishment or car purchase.

It's not home refurbishment it's a home purchase.
Neither is it for a new car.

FaceHead

Penelopa.Pitstop said:

I would just take loan and state different purpose when applying. House refurbishment or car purchase.

Agree with this. Sometimes telling a bit of a fib is a way to get a good outcome all round - in this case you get the purchase, and the lender gets paid their loans and interest.

Countrysider

mcpitman said:

Penelopa.Pitstop said:

I would just take loan and state different purpose when applying. House refurbishment or car purchase.

It's not home refurbishment it's a home purchase.
Neither is it for a new car.

Yes, unfortunately to take the loan it has to be a permitted reason and all the unsecured loans explicitly say it's not to be used for a house purchase. 

I (kind of) understand why a loan for a deposit is not allowed, but i really don't see why using a loan to top up a cash purchase without a mortgage is not allowed, when using the money for a car or a new kitchen is absolutely fine. 

However, even though the loan provider is unlikely to check, i'll have to justify the source of the money when i do come to buy so I cannot use a false reason. It seems daft and very arbitrary to me but I need to play by the rules until i'm safely in my house
 

FaceHead

You need to justify the source of the funds to your solicitor, and you can openly tell them it's from an unsecured loan. They should be fine with this, as their concern is around money laundering - they want to know that the money isn't the proceed of drug dealing or similar, so sharing your bank statements which show you borrowing it should be fine. 

Countrysider

FaceHead said:

You need to justify the source of the funds to your solicitor, and you can openly tell them it's from an unsecured loan. They should be fine with this, as their concern is around money laundering - they want to know that the money isn't the proceed of drug dealing or similar, so sharing your bank statements which show you borrowing it should be fine. 

I just assumed the solicitor would say that this breaches the purpose of the loan. If they wanted to see loan documentation then it would say 'house refurbishment' or similar and therefore not valid for house purchase. 

I know the solicitor isn't acting for the loan provider in this case and it is clearly not money laundering, but if I was unlucky enough to get a pedantic solicitor then they may say these funds cannot be used for this purpose and i'd be stuck as, technically, they are correct.

However, cashing out my credit cards and then instantly getting a loan for 'debt consolidation' to clear the debt is ok though there's an added step and associated fees. This is why i think it's daft - there's an easy way around it but it's costly.  

Thrugelmir

Countrysider said:

FaceHead said:

You need to justify the source of the funds to your solicitor, and you can openly tell them it's from an unsecured loan. They should be fine with this, as their concern is around money laundering - they want to know that the money isn't the proceed of drug dealing or similar, so sharing your bank statements which show you borrowing it should be fine. 

I just assumed the solicitor would say that this breaches the purpose of the loan. If they wanted to see loan documentation then it would say 'house refurbishment' or similar and therefore not valid for house purchase. 

I know the solicitor isn't acting for the loan provider in this case and it is clearly not money laundering, but if I was unlucky enough to get a pedantic solicitor then they may say these funds cannot be used for this purpose and i'd be stuck as, technically, they are correct.

Overthinking matters just leads to nonsense conspiracy theories.