Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • hwolves
    • By hwolves 16th Sep 19, 8:44 PM
    • 3Posts
    • 0Thanks
    hwolves
    A bit of a predicament..
    • #1
    • 16th Sep 19, 8:44 PM
    A bit of a predicament.. 16th Sep 19 at 8:44 PM
    Hi all,

    Hoping someone can offer me their advice and expertise!

    Myself and my partner have decided to separate 3 and a half weeks after completing on a house.

    The house is a new build property and we took out help to buy equity loan on this. We have decided to cut our losses and sell, recognising we are likely to take a hit on this.

    However, I have come across something Iíd not heard of before which is the Ď6 month ruleí. It seems there is some sort of rule which stops lenders lending on a property where the current owners have owned for less than 6 months?

    Does anyone have any advice?

    Thanks!
Page 1
    • davidmcn
    • By davidmcn 16th Sep 19, 8:53 PM
    • 13,140 Posts
    • 14,926 Thanks
    davidmcn
    • #2
    • 16th Sep 19, 8:53 PM
    • #2
    • 16th Sep 19, 8:53 PM
    Not really a "rule", just a commonplace policy which lenders have - properties changing hands very quickly are seen as an indicator of mortgage fraud or money-laundering. You can sell now to someone who's a cash buyer (or using a more broadminded lender), wait for a bit before putting it on the market, or start marketing now and see what happens (given it could take a while to find a buyer and for the transaction to progress anyway, by which time you might be at six months).

    Of course, buyers are in any event likely to be put off by a property being resold so quickly - either they won't hang around to hear your explanation, or they won't believe it. Not much you can do about that though.

    I take it you've already ruled out either of you buying out the other?
    • hwolves
    • By hwolves 16th Sep 19, 9:27 PM
    • 3 Posts
    • 0 Thanks
    hwolves
    • #3
    • 16th Sep 19, 9:27 PM
    • #3
    • 16th Sep 19, 9:27 PM
    Hi - thanks for the reply!

    Yes I agree we are probably not in a great position and any potential buyers will be suspicious.

    Buyout is unlikely on currently salary levels unfortunately.

    Sounds like we are going to need to wait a few months then - no chain will be beneficial I suppose?
    • hazyjo
    • By hazyjo 17th Sep 19, 9:27 AM
    • 12,338 Posts
    • 16,841 Thanks
    hazyjo
    • #4
    • 17th Sep 19, 9:27 AM
    • #4
    • 17th Sep 19, 9:27 AM
    Did you fix a mortgage? How long for? You know you'll have hefty exit fees for that too?


    Is there no way you could try counselling or something? Know it's not all about the money, but you're likely to lose tens of thousands by selling now.
    2019 wins: Bottle of Prosecco; Popcorn Shed popcorn; Moisturising 'M&S Time Capsules'; Case of Boost Sport + £30 Just Eat voucher; Battle Proms tickets and hotel; under-eye serum...

    "Should know better." Apparently.
    • cloo
    • By cloo 17th Sep 19, 10:06 AM
    • 1,203 Posts
    • 1,301 Thanks
    cloo
    • #5
    • 17th Sep 19, 10:06 AM
    • #5
    • 17th Sep 19, 10:06 AM
    It might be best for you to find a way of one of you staying in the property for a while at least. Is there a second bedroom you might let out to help cover costs, for example? I think one may need to inform lenders if letting a room but I don't there would be issues with doing so.
    • hwolves
    • By hwolves 17th Sep 19, 1:40 PM
    • 3 Posts
    • 0 Thanks
    hwolves
    • #6
    • 17th Sep 19, 1:40 PM
    • #6
    • 17th Sep 19, 1:40 PM
    Thanks for the further replies.

    Yes we fixed the mortgage for 5 years so the fee is something like £5,000 just for that..

    I’ve been told a few times that letting it out could be a good option!
    • xylophone
    • By xylophone 17th Sep 19, 1:48 PM
    • 31,391 Posts
    • 19,462 Thanks
    xylophone
    • #7
    • 17th Sep 19, 1:48 PM
    • #7
    • 17th Sep 19, 1:48 PM
    Are you able to stick it out on a house sharing basis?
    • HampshireH
    • By HampshireH 17th Sep 19, 1:55 PM
    • 1,831 Posts
    • 2,381 Thanks
    HampshireH
    • #8
    • 17th Sep 19, 1:55 PM
    • #8
    • 17th Sep 19, 1:55 PM
    It is against the terms of the Help to Buy loan to rent it out, so this is unlikely to be an option for you.

    However could 1 not stay and get a lodger?
    • sal_III
    • By sal_III 17th Sep 19, 2:34 PM
    • 1,395 Posts
    • 1,342 Thanks
    sal_III
    • #9
    • 17th Sep 19, 2:34 PM
    • #9
    • 17th Sep 19, 2:34 PM
    Thanks for the further replies.

    Yes we fixed the mortgage for 5 years so the fee is something like £5,000 just for that..

    Iíve been told a few times that letting it out could be a good option!
    Originally posted by hwolves
    Letting is not an option with HTB equity loan.

    Do you even have the money to repay the mortgage+EL if you sell now? Bear in mind you will have to sell at hefty discount in these circumstances, but still repay the EL based on RICS valuation. So you are looking at potentially £10'000s on top of the £5k mortgage ERC.

    Your best bet is to come to an arrangement to either house share as a non-couple or at least one of you to keep living in the property with a lodger if need be and pay off the other party. Neither is ideal, but the alternative is losing on a huge amount of money.

    Either way an expensive relationship lesson.
    • Fosterdog
    • By Fosterdog 17th Sep 19, 2:36 PM
    • 4,323 Posts
    • 7,524 Thanks
    Fosterdog
    You also need to consider things like early exit fees or buying out of utilities contracts too
    • sal_III
    • By sal_III 17th Sep 19, 2:44 PM
    • 1,395 Posts
    • 1,342 Thanks
    sal_III
    You also need to consider things like early exit fees or buying out of utilities contracts too
    Originally posted by Fosterdog
    Not necessarily, they are likely portable to wherever the OP ends up living next, or straight up no cancellation fee if you no longer live in the property. In any case will be drop in the bucket compared to everything else.
    • AnotherJoe
    • By AnotherJoe 17th Sep 19, 4:09 PM
    • 15,978 Posts
    • 19,184 Thanks
    AnotherJoe
    Hi all,

    Hoping someone can offer me their advice and expertise!

    Myself and my partner have decided to separate 3 and a half weeks after completing on a house.

    The house is a new build property and we took out help to buy equity loan on this. We have decided to cut our losses and sell, recognising we are likely to take a hit on this.

    However, I have come across something I’d not heard of before which is the ‘6 month rule’. It seems there is some sort of rule which stops lenders lending on a property where the current owners have owned for less than 6 months?

    Does anyone have any advice?

    Thanks!
    Originally posted by hwolves

    Find an EA and get some idea what they think you could sell for. Unless this is an area with rising house prices and shortage of houses it could be ruinous, literally.
    Please dont criticise my spelling. It's excellent. Its my typing that's bad.
    • Fosterdog
    • By Fosterdog 17th Sep 19, 4:14 PM
    • 4,323 Posts
    • 7,524 Thanks
    Fosterdog
    Not necessarily, they are likely portable to wherever the OP ends up living next, or straight up no cancellation fee if you no longer live in the property. In any case will be drop in the bucket compared to everything else.
    Originally posted by sal_III
    Things like broadband may be portable (if the service is both needed and available wherever they move to) however things like gas and electric may have fees for leaving a fixed deal early. If both OP and partner end up moving back home to parents or going into some other shared accommodation they are unlikely to be needed so will have a full cancellation charge.

    Yes they may well be a drop in the ocean but they are still things that are going to cost and need to be taken into consideration. It may be as little as £20 or it may be £200+ and something they need to prepare for while settling the financial side of the separation and dealing with the house. It's still an amount that would sting if they were not prepared for it when the time comes.
    • hazyjo
    • By hazyjo 17th Sep 19, 4:15 PM
    • 12,338 Posts
    • 16,841 Thanks
    hazyjo
    When you say no chain, I presume you can both move in with parents or family?


    Could you alternate your time at the property if you don't want to share? I'd not want to be renting it out with an ex. When I split with a fiance once, we used to spend a week or two each at the flat until we could sell. Was a bit unsettling, but it was lovely getting the flat to myself and getting away from my parents' house for a week or two.


    In the end, he moved in with his GF and paid me prob around half the mortgage until it sold.
    2019 wins: Bottle of Prosecco; Popcorn Shed popcorn; Moisturising 'M&S Time Capsules'; Case of Boost Sport + £30 Just Eat voucher; Battle Proms tickets and hotel; under-eye serum...

    "Should know better." Apparently.
    • sal_III
    • By sal_III 17th Sep 19, 7:47 PM
    • 1,395 Posts
    • 1,342 Thanks
    sal_III
    Things like broadband may be portable (if the service is both needed and available wherever they move to) however things like gas and electric may have fees for leaving a fixed deal early. If both OP and partner end up moving back home to parents or going into some other shared accommodation they are unlikely to be needed so will have a full cancellation charge.

    Yes they may well be a drop in the ocean but they are still things that are going to cost and need to be taken into consideration. It may be as little as £20 or it may be £200+ and something they need to prepare for while settling the financial side of the separation and dealing with the house. It's still an amount that would sting if they were not prepared for it when the time comes.
    Originally posted by Fosterdog
    Sure they might be charges, what I meant is that If losing £10'000s is not enough to make the case for not selling the property immediately, I doubt couple of £100s will tip the scales.
    • DCFC79
    • By DCFC79 17th Sep 19, 8:50 PM
    • 35,069 Posts
    • 22,166 Thanks
    DCFC79
    Thanks for the further replies.

    Yes we fixed the mortgage for 5 years so the fee is something like £5,000 just for that..

    Iíve been told a few times that letting it out could be a good option!
    Originally posted by hwolves

    Who told you that ?
    • csgohan4
    • By csgohan4 18th Sep 19, 12:36 AM
    • 6,505 Posts
    • 4,394 Thanks
    csgohan4
    Who told you that ?
    Originally posted by DCFC79


    Jack down in the local pub
    "It is prudent when shopping for something important, not to limit yourself to Pound land/Estate Agents"
    • Mutton Geoff
    • By Mutton Geoff 18th Sep 19, 6:37 AM
    • 1,644 Posts
    • 1,888 Thanks
    Mutton Geoff
    however things like gas and electric may have fees for leaving a fixed deal early. If both OP and partner end up moving back home to parents or going into some other shared accommodation they are unlikely to be needed so will have a full cancellation charge
    Originally posted by Fosterdog
    Are you sure about that? Most energy deals Iíve signed up to only have exit fees if you change to a new supplier within a penalty window (and theyíre not allowed to charge you within 42 days of the end of the deal).

    If you move out, they donít usually charge or force you to take the deal somewhere else. My gf just moved out of rented and her deal was until end of December but the £60 dual fuel penalty wasnít payable.
    Compensation/Refunds - £4,655 | Stooz Profits - £7,636 | Quidco - £4,365 | Tax Avoidance - £107,000
    All with a big thank you to Martin and MSE.com from Mutton Geoff!
    • MobileSaver
    • By MobileSaver 18th Sep 19, 8:29 AM
    • 1,914 Posts
    • 2,926 Thanks
    MobileSaver
    We have decided to cut our losses and sell, recognising we are likely to take a hit on this.
    Originally posted by hwolves
    For the avoidance of doubt, it's not just likely but practically guaranteed you will take a hit.

    Quite apart from the mortgage early redemption fees, your "new build" that you paid a premium for is now no longer a new build; the house has been lived in and the appliances used, in the real world no-one is going to pay you the same that you paid the developer.

    And, of course, any potential buyer will not be able to use the same HTB Equity Loan incentive that you did...
    Respect to 3 of the greatest actors of all time; amazing people who are totally believable as the characters they play & almost single-handedly make the shows they starred in:

    Peter Dinklage as Tyrion Lannister in Game of Thrones
    Daniel J. Travanti as Frank Furillo in Hill Street Blues
    Claire Danes as Carrie Mathison in Homeland
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

115Posts Today

1,183Users online

Martin's Twitter