First time buyer help

denise38 · 25 January 2020 at 7:15PM

My 20 year old daughter is looking at buying her first house , she has savings in the help to buy ISA. My question is she is looking at a flat which has home report value of £60000. We are in Scotland . It has a reduced price and is expected to sell around £53000. Is she still expected to put down deposit of £6000 even although there is already equity in the flat . I was hoping as she would pay less than market value she might get away with paying less . It’s come when she is couple thousand short . She has enough to pay the 10% in that she has £6 but doesn’t have enough to pay solicitors fees and buy furniture . She doesn’t want to take loan from family as she has budgeted fir everything . Thanks for any advice

Getting_greyer · 25 January 2020 at 7:40PM

Surely the equity of the current owner doesn't come into it? If it sells for 53k the a 10% deposit is 5.3k ?

Apologies if I've got the wrong end of the stick.

denise38 · 25 January 2020 at 7:47PM

That’s what I don’t know as the flat is valued and has home report of £60 k so normally you would have deposit of 10% and mortgage would be £54 . The LTV paying £53 would already be at less than 90% of the flats value . I haven’t had to deal with mortgages in a while as always had large deposit from selling and buying larger property . She could put down £5300 which would be 10 % of selling but would leave her shirt for furnishing and fees. I could lend money but she won’t have that . It’s come too early needed another 4 months of savings to have the full whack and be totally independent . I am hoping that I could even gift her part of her fees . Can’t help much more as already gifted car money to other daughter rather than a loan and she is paying back .

davidmcn · 25 January 2020 at 7:53PM

denise38 wrote: »

My 20 year old daughter is looking at buying her first house , she has savings in the help to buy ISA. My question is she is looking at a flat which has home report value of £60000. We are in Scotland . It has a reduced price and is expected to sell around £53000. Is she still expected to put down deposit of £6000 even although there is already equity in the flat .

The lender will always use the lower of the actual selling price and the valuation (they take the view that the price actually achieved on the open market is a safer indicator of the true value than the HR surveyor's guess) - so it would be £53k used as the value for calculating LTV.

denise38 · 25 January 2020 at 10:47PM

Thank you that’s what I wasn’t sure of with not being up on what’s going on .

First time buyer help

Comments

Categories

Get our FREE Weekly email full of deals & guides - and it’s spam-free