Hi,

Need information and quick! Mother in law wants to give us first refusal on a house they own. They would like us to buy it and would like £100,000 for it Bargin or what! They want to put it on the market for £129,999.

Problems we have owe £13,000 in loans our wages in total come to about £48,000ish before deductions i think. I am trying to find out about gift deposit. as they would give it to us for less.

Would like to know what places do the gift deposit and would we get a mortgage? i know it's tight out there at the moment and need some help just to see what you all know.

Any help would be grateful Cheers X

Katy, I'd be asking 2 questions to start with (1) What's the background on the loans? (2) If they were putting it on market for £129,999 why do you feel £100k is a bargain?

Couple of things for you to check to start with..

1. Put the postcode into rightmove www.rightmove.co.uk and check what similar properties in the area are being marketed for (remember these are the asking prices so knock approx 10% off to get a more realistic value at current time).

2. Check the postcode here also www.houseprices.co.uk and see what prices they've previously sold for.

I'll hazard a guess they'll come out less than £130k ?

Regardless of how much you see it as a bargain I would clear the loans first. Assuming your Ma in law doensn't actually live there (as you say "a house they own) this is a sensible way to do it which benefits both parties -

1. Depending on the term to clear the loans?, get a solicitor to draw up an 'option' agreement between yourselves and mother in law, stating that you have the 'option' to buy the property at say £130,000 at any time in the next 5 years (or any other length of time needed), subject to you renting the property in the meantime.

2. Agree a rental amount sufficient to more than cover any of mother in laws liabilities eg mortgage+insurance etc but at the same time making it easy enough for you to clear your loans as quickly as possible.

The benefit to MIL is she will get immediate monthly return rather than have house sat on market for ever (no one else is going to buy it in current climate), plus she's effectively got guaranteed buyers lined up soon as they are ready to exercise the option.

Benefit to you and hubby is instead of jumping into a major commitment whilst having a loan over your heads, you have your house effectively 'reserved' for you (no-one else can buy it as long as you have it under option) and looking at the worse-case scenario if you were to break up with hubby (heaven forbid!) you can give up the option and just walk away (no lender chasing you both). While you are renting you're clearing loan.

Soon as you're ready,to buy you casually arrange mortgage etc whilst you are still living in property as a tenant (much easier life). You could structure it so that as soon as loans cleared you keep in the habit of putting same amount away each month towards a deposit,then when you're ready, you exercise the option and buy.

If MIL concerned about possibility of you not completing another way is to exchange contracts soon as you like and set completion within x years or whatever (that'll mean she doesn't trust you!).

In any event you're unlikely to get a lender to accept vendor gifted deposit under your current circumstances.

did I just type all that?!!!!!

Hi,

We would not be living in the property at this time as my husband is serving in the Forces. So it would kind of be a buy to let but only for 18 months and then we would move into the property. We have 1 loan which has less than 18 months left and another which has 55ish months left on it. Would it still be a viable option? My sister has just brought my mothers property with a gifted depsoit and they have loans too! Does it go on what kind of people you are because we are nice decent people that pay our way and bills.

It seems like out there all the losers (including my sister i do love her but she never has any money!) are getting what they want and we just get stiffed over!

I have looked at the propertys like you have said and they are all being or have been sold for £130,000 to £145,00 so i feel it is a bargain. Renting from them is not good for either parties due to my FIL having to leave his job (military for the last 41 years) and them needing to sell because they cannot afford to keep both.

Any more advice would be helpful. Thanks X

Katy965: We would not be living in the property at this time as my husband is serving in the Forces. So it would kind of be a buy to let but only for 18 months and then we would move into the property. We have 1 loan which has less than 18 months left and another which has 55ish months left on it. Would it still be a viable option?

Katy965: Renting from them is not good for either parties due to my FIL having to leave his job (military for the last 41 years) and them needing to sell because they cannot afford to keep both.

Not much financial sense in you buying at this stage if you're not going to live in it.

They (parents) are "needing to sell because they cannot afford to keep both" so shifting liability to you will solve their problem but potentially create one for you.

Suggestion - rent the place out for the next 12-18 months (until you're in a position to move in and buy). Use a reputable local lettings agent if you or parents have no landlord/tenant experience. As I suggested you could initially move in as a tenant and arrange mortgage on a more relaxed basis once circumstances are ideal for both parties.