£100k shortfall on second homeMake Text Bigger
I have found a house that would I would like to buy as my main residential property. Although I wasn’t looking to move, it’s a very good price and I would end up making approx £400k on it after a new kitchen and some cosmetic work.
The problem is, I already have a house which I would have to let out and port my current residential mortgage to the new property. After the calculations and based on the cost of the new property, I am £100k short. I have asked the vendors if they would be interested in my offer but based on me paying them the shortfall in say 2 years time on the sale of my first property. There would be a huge incentive for me to sell as I would get a refund of the extra 3% stamp duty I would pay on the second property.
My question is what would be the best way to wrap the £100k shortfall into an attractive package for them so they feel confident that they will get the final payment for their property? I am going to offer 5% interest pa and my solicitor has mentioned a unilateral notice with an enforceable contract.
I have £600k equity on my current house and £100k equity on a holiday house.
Any advice would be much appreciated.
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