short term interest free mortgage question
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as you can see this is all new to me. thus the ignorance of my questions.
I will set it out a bit better.
We have probate on deceased relatives house. House has mortgage of about 117k. House had tenant who has now moved out. Estate agents will evaluate it shortly. It currently has ceilings removed, electrics dangling, holes....lots of shoddy half jobs. But it has potential to be finished properly and sold. Would cost about 30k to do up properly. So the question I guess is how best to finance that IF it's what we decide to do. We private rent. Some savings. Good credit history.0 -
OK, so it is not habitable by the sounds of it and you would be unlikely to get a normal mortgage secured on it for this reason.
People actually lived in there like that?!?! Or did they trash it before they left?
Anyhow, you are going to need to speak with a broker and possibly need to go down the route of bridging or development finance. Expect it to be expensive.
I can't see any mainstream lenders agreeing anything if the ceilings are down and dangerous electrics.0 -
If you don't have experience or knowledge of renovating property, then I suggest you avoid it. You will not be able to make much profit from your work and since it's not your main home, you'll pay tax on your profits.
Is there any room for an extension? Some nice architects drawings, confirmed planning approval for an extension and you can make some money selling a "doer upper". Plenty of people willing to take on the task without realising the true cost of completing the work, or professionals who have access to labour and materials cheaper than you have which is where their margin lies.
Everything will be cheaper selling as is (or with the planning), and much better for your stress levels. How is the existing mortgage going to be settled?Signature on holiday for two weeks0 -
Hmmm.... a property in that condition is a whole different ballgame. As others have said, it's unlikely to be mortgageable. I assume that it wasn't in this state when the mortgage was taken out. The current mortgagor will want the debt repaid.
This doesn't appear to be a simple cosmetic job and therefore best left to the professionals. Unless there is a large potential for profit don't go near it. Don't consider doing the work yourselves.
You will struggle to raise the finance and even if you find a lender the interest rates will be high. Servicing the debt will add cost to the project and put you under pressure to complete the work and sell quickly.
The up-front investment and risk suggest that this would be the kind of property that a professional developer would expect to buy at auction at a suitably reduced price.
Have you had the house valued by a surveyor? I believe that such a valuation is required in order to settle the deceased's estate. Is the house valued higher than the o/s debt despite its condition? If not, then you haven't inherited anything. Indeed, if the estate is insolvent then don't 'intermeddle' in the deceased's affairs. If you do, you may find yourself taking-on liability.0 -
Sounds like you're better off letting the executor sell it to cover the mortgage and give you any left over cash.0
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Whats your credit rating like, Lots of interest free credit cards around, could use them to purchase materials for doing the place up0
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Yes people lived there. I don't know how!
We have probate and thus are executors ( we as in my husband ).
We are just looking for options as it's getting valued tomorrow in its present state and a proposed valuation when done up. We've had a decent builder estimate a reasonable costing. It could add 50k profit. So not a little bit.
We will sell the house either way as we don't want it.
Mortgage is about 120k.
Just like to have ideas of how we could manage the finance as we do have some savings which could cover the renovations but not the mortgage pay off.0 -
What was the probate valuation?
Easiest way will be keep the house in the estate, the mortgage company should hold of if activity looking to sell.
Do it up quickly(employ people) using savings then sell for more money.
Be very focused on renovations that add value and make it mortgageable and can be done quickly.
There a point in administration where you can treat the beneficial interest as passing to the beneficiaries to enable their CGT allowances to be used even though you don't assent the property to them.
Costs and tax are going to eat into any uplift in value.0 -
evaluation was about 170k but that was assuming good condition.0
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