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Hello,

I have finally had to give in and make an offer on a property which has been accepted.

I would rather have waited for a few more months to see if any broken chains emerged and then made an offer.

Background: I have been saving and will be borrowing from family and thus will be a cash buyer at 375k (property was listed at 390k).

I would appreciate advice on the following:

- EA has asked for proof of funds and said I need to show I have funds for the full 375k.  Is this usually true?  I can show funds for 345k and have asked friends of family for the remainder.

- We realised after the offer was accepted that two similar homes on the street with similar specs just went for 365k.  This data just came on recently via zoopla.

With those with some experience in this field, how can I get the price down further?  

Should I mention the lower price only after I have shown the EA proof of 345k of funds?

Will EA be regarding me as a time waster if I cannot show the final 30k?

The Mrs seems to think they will not be impressed if i cannot show the full funds and may result in the offer not being officially accepted.

Any help on the above would be appreciated.

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I would appreciate advice on the following:

Why would you ask advice from people you know will tell you you are insdance to buy a property.

 

- EA has asked for proof of funds and said I need to show I have funds for the full 375k.  Is this usually true?  I can show funds for 345k and have asked friends of family for the remainder.

Yes they need to see that the money has not just been transferred to your account from another source for money laundering. Your solicitor will ask the same.  Also it is to be sure that you have the funds to be able to proceed as there are many people who lie about their financial status when they view/offer on property.  The vendor would want to be sure you are not a dreamer. 

 

Will EA be regarding me as a time waster if I cannot show the final 30k?

No this is fine you may have to provide a letter to your solicitor from family to say they are gifting you the money.  

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- EA has asked for proof of funds and said I need to show I have funds for the full 375k.  Is this usually true?  I can show funds for 345k and have asked friends of family for the remainder.

I have seen this a lot in the last 6 months and all the EAs i've spoken to all ask for it where i never saw it before. 

I'm in a similar position and had similar concerns (have proof for the bulk of cash but not for about 20%) so i'd be very interested in what happens here. 

 

Will EA be regarding me as a time waster if I cannot show the final 30k?

You're able to prove £345,000 cash readily available. I'd hardly call that a 'time waster'. Very very very few people can do that, even supposedly rich people.

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Thanks for the responses thus far.  Over the years there have been a few people on here who have had to take the plunge and enter the property market.  There are *some* wise heads on here, so advice would be appreciated.

Yes with regards to money laundering I have evidence for the 6 months of accounts all the way up to 345k.  They will not accept 350k, I previously offered this which they rejected.

Back to my original question, any suggestions on how to proceed?  I was thinking that EA should be happy someone can prove they are within 30k with provable funds not requiring a mortgage.  How I can leverage this to get a bit more off?

 

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Thanks for the responses thus far.  Over the years there have been a few people on here who have had to take the plunge and enter the property market.  There are *some* wise heads on here, so advice would be appreciated.

Yes with regards to money laundering I have evidence for the 6 months of accounts all the way up to 345k.  They will not accept 350k, I previously offered this which they rejected.

Back to my original question, any suggestions on how to proceed?  I was thinking that EA should be happy someone can prove they are within 30k with provable funds not requiring a mortgage.  How I can leverage this to get a bit more off?

 

I would use the comparative - expect a push back of, well number 12 is nothing like number 17. So know the full facts as to sq ft, which road, garden etc and look to settle in between.

Also - how much do you want this property rather than another? negotiation post offer being accepted is always a "risk" in so much as the seller can say no and move on.

Oh and quote land registry direct not zoopla.

Edited by captainb
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You can always go and see the others. If you have only made an offer, you can always retract it (beauty of the process in this country /sarcasm). 

You have no sunken cost right? Also if they are very similar (very unlikely) you can always offer 345 cash buy in a take it or leave it approach

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I would use the comparative - expect a push back of, well number 12 is nothing like number 17. So know the full facts as to sq ft, which road, garden etc and look to settle in between.

Also - how much do you want this property rather than another? negotiation post offer being accepted is always a "risk" in so much as the seller can say no and move on.

Oh and quote land registry direct not zoopla.

Yes, will try to see land registry and do the comparisons.

I am expecting some push back, therefore thinking it might be better to raise this post survey.  This house does tick the boxes we are looking for, though there are others we would rather like which we have been outbid on now a couple of times.

I am seeing virtually zero signs of broken chains at the moment which is amazing considering the amount of jobs being lost or peoples reduced financial situations.

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You can always go and see the others. If you have only made an offer, you can always retract it (beauty of the process in this country /sarcasm). 

You have no sunken cost right? Also if they are very similar (very unlikely) you can always offer 345 cash buy in a take it or leave it approach

Well interestingly we know of a house nearby which went for cash at a much discounted rate because the chain broke down at the last minute and the couple had found somewhere else which they liked.

I am therefore thinking getting a discount would only work after the vendors are serious about moving.

I will also be saying we want to move before the stamp duty holiday ends, are not in a chain and don't need a mortgage, so its defo sale to be made, unfortunately vendors have been preferring chains and mortgages over us.

An EA has told us he preferred our offer as it was baked in but vendors went for someone else offering "a little bit more".

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- EA has asked for proof of funds and said I need to show I have funds for the full 375k.  Is this usually true?  I can show funds for 345k and have asked friends of family for the remainder.

This bit I think is going to be your issue. Having gone through this process recently ourselves, the banks are quite specific as to what they will and won't accept as a gifted deposit. From the Halifax who we went with below - family friends cannot gift you money. 

 

Acceptable

Not Acceptable

Parents, step parent, parents in laws

Family Friend

Brothers and sisters, half brothers and sisters, step brothers and sisters, brother and sister in laws

Employer

Grandparents, step grandparents

Developer/ Landlord

Auntie/Uncle (related by blood)
Niece/ Nephew

Auntie/Uncle (related via marriage)

Partners living with applicant either common law or co-habitee

Cousins

Applicants’ children, step children, son and daughter in laws and adopted children

Foster/Guardian children

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Thanks for this, I was not aware of the above, much appreciated.

The only thing which springs to mind is that banks would not be involved, so therefore bypassing the above?  If we have an old family friend who wants to lend me some money, or if we want to sell some assets such as gold stored at a bank then that should not be objectionable?

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Buying a home was historically a landmark joyous event even a celebratory occasion.

Now it seeks to be marked with fear and desperation more a fomo's event even more so if using borrowed funds.

Adjust your offer by how much you are prepared to lose and the effort that went it to earn it.

Welcome to HPC

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This bit I think is going to be your issue. Having gone through this process recently ourselves, the banks are quite specific as to what they will and won't accept as a gifted deposit. From the Halifax who we went with below - family friends cannot gift you money. 

 

Acceptable

Not Acceptable

Parents, step parent, parents in laws

Family Friend

Brothers and sisters, half brothers and sisters, step brothers and sisters, brother and sister in laws

Employer

Grandparents, step grandparents

Developer/ Landlord

Auntie/Uncle (related by blood)
Niece/ Nephew

Auntie/Uncle (related via marriage)

Partners living with applicant either common law or co-habitee

Cousins

Applicants’ children, step children, son and daughter in laws and adopted children

Foster/Guardian children

This isn't a gifted deposit though - that table relates to calculating the equity being provided against a mortgage. 

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Thanks for this, I was not aware of the above, much appreciated.

The only thing which springs to mind is that banks would not be involved, so therefore bypassing the above?  If we have an old family friend who wants to lend me some money, or if we want to sell some assets such as gold stored at a bank then that should not be objectionable?

Ah yes, sorry you did say. Shouldn't be an issue then I guess as long as the money is all clean and you can prove where its come from. I found the laundering checks pretty straight forward to be honest. We had money in a few accounts, and it all got pushed through pretty quick smart. In terms of the advice, you are going to get 5 pages of people telling you to offer 70% below asking price, interspersed with some insults. The property is worth what it's worth to you, so if you are comfortable with it then go for it. Balanced opinion you will not find on here...

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Yes, thanks, it is a family effort with all of us chipping in to get to this figure from years of work.  

I am obviously a member of this site and have been a visitor for years waiting for a price crash.  Ideally if I could get the property for 350k I would be happy, it is a place to live and not an investment.  If lower than this would be amazing but this govt is fanatical about keeping prices inflated.

At the current price I am not ecstatic but I am realistic, shaving off 10-15k would make me much happier about the transaction.

 

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Hello,

I have finally had to give in and make an offer on a property which has been accepted.

I would rather have waited for a few more months to see if any broken chains emerged and then made an offer.

Background: I have been saving and will be borrowing from family and thus will be a cash buyer at 375k (property was listed at 390k).

I would appreciate advice on the following:

- EA has asked for proof of funds and said I need to show I have funds for the full 375k.  Is this usually true?  I can show funds for 345k and have asked friends of family for the remainder.

- We realised after the offer was accepted that two similar homes on the street with similar specs just went for 365k.  This data just came on recently via zoopla.

With those with some experience in this field, how can I get the price down further?  

Should I mention the lower price only after I have shown the EA proof of 345k of funds?

Will EA be regarding me as a time waster if I cannot show the final 30k?

The Mrs seems to think they will not be impressed if i cannot show the full funds and may result in the offer not being officially accepted.

Any help on the above would be appreciated.

I can't offer you any advice on the proof of fund stuff as I was not a cash buyer. I did have to send the EA bank statements as proof of deposit, which I had, so no big deal.

But what stands out for me is why are you deciding to not take a mortgage? The game is rigged in favour of holding debt. I will play the rigged game in my favour, hence I have a mortgage as I expect fiat to continue devaluing and eroding the real value of my debt.

But don't take that as financial advice, more of a question. Some people prefer certainty. I prefer a calculated risk in this case.

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But what stands out for me is why are you deciding to not take a mortgage? The game is rigged in favour of holding debt. I will play the rigged game in my favour, hence I have a mortgage as I expect fiat to continue devaluing and eroding the real value of my debt

I kind of understand why you want to be completely mortgage free to start with, but tend to agree with dugs that there does not appear to be any significant financial advantage in doing so at present.  Indeed, probably the opposite.

Certainly I would advise (not financial!) against taking a gift or loan from a family friend instead of a small loan if there is any chance that taking it could later detrimentally affect the friendship...

Show them the £345k in the bank and see what the response is.

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I kind of understand why you want to be completely mortgage free to start with, but tend to agree with dugs that there does not appear to be any significant financial advantage in doing so at present.  Indeed, probably the opposite.

Certainly I would advise (not financial!) against taking a gift or loan from a family friend instead of a small loan if there is any chance that taking it could later detrimentally affect the friendship...

Show them the £345k in the bank and see what the response is.

Its also a legal issue as to whether they have a claim on the property or not - if you do accept a loan make sure there is a proper loan agreement drawn up, not just back of the fag packet or down the pub chat.

In 5 years time that £50k could have been for 10% of the property not as a direct unsecured loan in someone's memory

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I can't offer you any advice on the proof of fund stuff as I was not a cash buyer. I did have to send the EA bank statements as proof of deposit, which I had, so no big deal.

But what stands out for me is why are you deciding to not take a mortgage? The game is rigged in favour of holding debt. I will play the rigged game in my favour, hence I have a mortgage as I expect fiat to continue devaluing and eroding the real value of my debt.

But don't take that as financial advice, more of a question. Some people prefer certainty. I prefer a calculated risk in this case.

A good question, you are actually right, those saving like myself have been hit continually over the years. 

The reason for not taking a mortgage is for religious reasons primarily (Muslim faith), if I can avoid I would like to do so.  Also the idea of not being a debt slave until pension age also appeals to me.

With regards to the loans they will hopefully be minimal and from close family friends.  I have done this once before where we all chipped in to pay off the mortgage in the house we currently live in, with bank transfers to the accounts of those who lended as a record of payment.

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  • 439 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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