Shelter’s Income and expenditure figures highlighted13:57 PM, 4th February 2019
About 3 weeks ago 35
I put down the reservation fee to buy a property on a re-assignment basis (i.e. I am buying the right to buy from somebody else; not directly from the builder). I do not have any problem in putting down the 10% required to exchange contracts however, at completion (expected to be December 2015) I will need to have my mortgage in place for roughly 75% of the price I agreed the re-assignment.
I spoke with my solicitor and he advised me to check with a few banks if they are willing to lend the money on an off-plan property bought through a re-assignment. This is because some of his other clients had some problems with arranging the mortgage with the banks. He told me that 8 out of 10 banks would not lend me the money because I did not buy the property directly from the builder.
I tried to call Natwest and Clydesdale, the former told me that the seller of the re-assignment should have kept the right to buy at least for 6 months, the latter told me that it would not be a problem and they would base their lending decision on my circumstances and the fact that the rental income is at least 125% of the mortgage payment I will have to make.
I then called a Mortgage broker and he told me that as long as I got enough money to buy the contract (i.e. if I can pay the 10% of the agreed price) it should not be a problem arranging the mortgage when I need to complete.
I would like to know what is the general consensus and if there is anybody that has some sort of experience with these types of situations.
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