Thursday, March 6, 2008

Insane advice

How to buy a house with no deposit

A reader asks: As a 20-year old first-time buyer, can you still get onto the property ladder without a deposit? MSN Money property expert Ajay Ahuja replies:The short answer to your question is Yes! Absolutely crazy advice.. even putting saying putting the deposit on your credit card is a good idea.

Posted by phil tc @ 10:25 AM (372 views)
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2 thoughts on “Insane advice

  • Isn’t the below illegal? What the Panorama was about?

    3. Create vendor deposit
    This is where in effect the vendor pays the deposit for you.

    It involves the property being valued in excess of what the vendor is selling to you for. If this is the case then you can avoid paying a deposit of up to 5% which is the maximum allowed vendor deposit for most lenders.

    So for example if you found a property for £95,000 and the property got valued at £100,000 then you could structure the deal as:

    Purchase price: £100,000
    Vendor deposit: £5,000
    Net price: £95,000

    Then if you went in for a 95% loan to value mortgage the lender will lend 95% on the purchase price which has been set at £100,000 thus the amount being lend is £95,000 which is the net price agreed with the vendor.

    So:
    The net price: 95,000
    The amount lent: £95,000
    The amount required from you: NIL

    Again no money is required from you other than the other costs such as solicitors fees, survey etc.

    To find out more tips and tricks why not join my free course.

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  • An Bearin Bui says:

    So to sum up, his tips on getting on “the ladder” without a deposit are: 1. get a cashback deal with the mortgage, 2. borrow the deposit as a personal loan and 3. – my favourite – commit mortgage fraud by overvaluing the house and agreeing a fraudulent deal with the seller. This means that the property is valued at 100k but you only agree to pay 95k so you “have” a 5k deposit.. shocking that someone is allowed to put out this kind of illegal tripe. This should be reported as encitement to mortgage fraud.

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