when is a mortgage deposit needed when buying?
hello,
i am a first time buyer and am viewing a property i am wanting to buy on friday (i already know the property and am sure i will be buying it) i have a mortgage through my bank lined up in principal and they said if i wanted to go ahead with it just to ring them then they will process it through credit checks etc (i know i wont have any credit problems) but on my app form i stated the property i was wanting to buy was £90,000 and i had a 5% deposit. now at the moment i only have 1k of the deposit but the other £3,500 i will have on payday. If i question the bank to process the mortgage application do i need to have the available deposit in my account at that time or can i still get accepted for the mortgage subject to having the funds available when the sale completes in around 6 weeks time?
also when im paying for the survey which i have got quotes for which are £350 do i pay this upon completion or do i pay this at the start?
thanks
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Tags: credit checks, first time buyer, mortgage application, quotes
You need to pay the deposit before you complete via your solicitor, the survey you will need to pay when you instruct the company to do the survey for you.
Also be aware you will also need to pay for your solicitor who will conduct searches etc on your house. You will need approx £1,500 but phone around as charges vary.
you need to pay the deposit before completion (at which point you then legally own the house).
When is ‘pay day’? You appear not to have the funds to proceed. When you place an offer on a house it is secured with a deposit. Offer to buy a property you then pay the deposit. If you are buying the property at auction you need the money there and then (deposit and agreed mortgage to cover remainder). Otherwise, I’d query why you must ‘offer’ to buy before you have the funds available. With the property market on the slide, I can’t imagine there being a rush to buy the property unless it is a new build ‘affordable’ property in an otherwise high value area. As others have mentioned, you will also need ready cash to pay conveyancing fees and such like. My advice is to wait.
In your postion I would buy from aution at a price that is below market value. The diffence between market value and price paid is called equity ( your deposit )
You can buy the property from the aution with a bridging loan, then pay the bridging loan back with the proceeds from the mortage.
This is how most property investors would opperate.
I have not done this my self, but know of people who do it often.
Excellent Luck
For the survey it’s at the start.