Funding house move.

Woodentop11

For health reasons we need to move. We have no mortgage and the properties we are looking at are a similar value to the one we are in now.
Should be straight forward, problem is it won't be possible for logistical reasons to do the traditional flit on the same day as contracts exchanged.
We really need to buy, move and then sell our existing property, which should sell quickly in the current market.
We have some capital and could put approx 60% deposit down on the new property.
What would be the best way of funding the difference?
We would need to borrow around £90-100k until the sale of our existing property goes through.

Mr.Generous

Get a repayment mortgage then pay it off when your's is sold?  Banks used to provide bridging loans for this type of thing, secured against the property shouldn't be too expensive with current rates. It's the kind of situation where a visit to a branch and a chat with helpful, knowledgeable staff used to be the way to go, now I'm not so sure.

anselld

Well assuming you can meet the other criteria, age, income, etc you could borrow on a mortgage with no early redemption fee.
 However it would surely be a lot easier and cheaper to overcome the logistical difficulties somehow.  That is the job of professional movers.  Why don't you speak to some and see what they can offer?

Snookie12cat

You plan to do exactly the same thing I did recently. 
If you have no mortgage just apply for a standard residential mortgage (assuming you can qualify for the loan you need). Take out a tracker with no early repayment charges and pay it off once its sold.

To warn you though, there is no guarantee of a quick sale, so you must factor council tax, utilities etc for the empty house into your finances. We are still in possession of the old house 4 months on as the sale fell through. Its frustrating and with rising rates its not an ideal situation.  

You will also need to factor in the extra 3% or 4% stamp duty for owning two houses. It can be claimed back when you sell, but it will eat a large chuck of that 60% deposit you have. 

martindow

I don't understand what your 'logistical reasons' could be for not being able to buy and sell simultaneously.

Removal companies do this for people every day, packing up quickly (typically starting packing the day before and finishing on the morning you are leaving),  Then they unpack later that day or the following day if you are moving some distance.

All you need to do is keep out of their way and let them get on with it.  It costs a few thousand, but is a bargain compared to paying for bridging finance for an unknown period.

Could you not do this?

K_S

Woodentop11 said:

For health reasons we need to move. We have no mortgage and the properties we are looking at are a similar value to the one we are in now.
Should be straight forward, problem is it won't be possible for logistical reasons to do the traditional flit on the same day as contracts exchanged.
We really need to buy, move and then sell our existing property, which should sell quickly in the current market.
We have some capital and could put approx 60% deposit down on the new property.
What would be the best way of funding the difference?
We would need to borrow around £90-100k until the sale of our existing property goes through.

@woodentop11 If you have the income (as per lender criteria) to support a mortgage for the remaining 40%, you could take out a standard repayment mortgage and pay it off once your old property is sold. That is likely to be the most cost-effective way to finance the purchase of the new house.

If you don't have the income to support a standard mortgage, then you're looking at more expensive loans like bridging loans  or (slightly cheaper) short-term financing alternatives offered by a couple of smaller lenders.

Flugelhorn

I have done the "buy the next property  and then sell the old one after having moved"  a couple of times  it is definitely less stressful and you get the 3% SDLT back when the first house is sold.  

I once did it by re-mortgaging the first house, that was in 2005 - not sure if things have changed re this  

GaleSF63

martindow said:

I don't understand what your 'logistical reasons' could be for not being able to buy and sell simultaneously.

Removal companies do this for people every day, packing up quickly (typically starting packing the day before and finishing on the morning you are leaving),  Then they unpack later that day or the following day if you are moving some distance.

All you need to do is keep out of their way and let them get on with it.  It costs a few thousand, but is a bargain compared to paying for bridging finance for an unknown period.

Could you not do this?

Without going into any detail, I would be in the same position as OP if I moved. It isn't always as simple as you suggest. 

anselld

GaleSF63 said:

martindow said:

I don't understand what your 'logistical reasons' could be for not being able to buy and sell simultaneously.

Removal companies do this for people every day, packing up quickly (typically starting packing the day before and finishing on the morning you are leaving),  Then they unpack later that day or the following day if you are moving some distance.

All you need to do is keep out of their way and let them get on with it.  It costs a few thousand, but is a bargain compared to paying for bridging finance for an unknown period.

Could you not do this?

Without going into any detail, I would be in the same position as OP if I moved. It isn't always as simple as you suggest. 

Maybe so.  I am not convinced.   The OP and possibly yourself seem to have concluded it would be impossible to move conventionally without even speaking to the experts.  It may just be fear of the unknown which could be overcome with the correct expertise and assistance.

housebuyer143

anselld said:

GaleSF63 said:

martindow said:

I don't understand what your 'logistical reasons' could be for not being able to buy and sell simultaneously.

Removal companies do this for people every day, packing up quickly (typically starting packing the day before and finishing on the morning you are leaving),  Then they unpack later that day or the following day if you are moving some distance.

All you need to do is keep out of their way and let them get on with it.  It costs a few thousand, but is a bargain compared to paying for bridging finance for an unknown period.

Could you not do this?

Without going into any detail, I would be in the same position as OP if I moved. It isn't always as simple as you suggest. 

Maybe so.  I am not convinced.   The OP and possibly yourself seem to have concluded it would be impossible to move conventionally without even speaking to the experts.  It may just be fear of the unknown which could be overcome with the correct expertise and assistance.

Maybe they just don't want to be in a chain. Nothing wrong with that...

bobster2

OP said they needed to move for health reasons.

Not sure if it's the case for the OP but if someone in a family has complex health needs - it can be difficult to get a house into a marketable condition (e.g. for viewings etc) and difficult to pack up. Moreover, the new house might need adaptations, modifications before they can move in.

Finally, although it's very rare - you can get things that go wrong on completion day with a purchase. In normal circumstances, a short delay, a night or two in a hotel - with belongings in storage - wouldn't be a major issue. But for someone with complex health needs this could be a serious problem.