New purchase is a contract reassignment?

by Readers Question

14:18 PM, 11th July 2016
About 2 years ago

New purchase is a contract reassignment?

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New purchase is a contract reassignment?

Can someone explain me the math on a contract reassignment?
(FYI: I know there are risks in contract reassignments, but my question is not trying to understand those risks)contract

I have an opportunity to take on a contract re-assignment. The current vendor is selling it at lower than the original price which is what makes it really attractive. What further makes it attractive is it is due to complete next 6 to 8 weeks so I can be certain I will have a valid loan from the limited vendors who do lend.

The original price is 360K and the vendor wants to sell it for 340K and maybe I can go even lower.
1) I presume the Bank will consider the price at 340K or lower and not the original price of 360K?
2) How much do I need to pay the bank?
3) How much do I need to pay the current vendor?

Many thanks

Sid



Comments

Neil Patterson

14:26 PM, 11th July 2016
About 2 years ago

Hi Sid,

Can I check I have understood the terminology correctly here?
You are taking over from someone else who has already exchange to purchase that property.

In which case funds should only be sent to solicitors and no one else upon completion. If the vendor is happy with the lower purchase price that should have no effect on yourself.

However please do check with your lender as post credit crisis Lenders are suspicious of assignments of contract due to purchase price comparables being massaged in the past.


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