OK, so the buyer of our house pulled out, but were well into plans and paid deposit on our plot to build. 

 

Can sort alternative finance, thought about seeing if a builder or others would invest in our build (then get their investment back when ours sells again), but are now looking at a bridging loan for 12 months at ridiculous%%%.

 

I know, its not ideal, but we need to make a move. 

 

So the scenario is this :

We get the £160k bridging loan, towards our £250k land purchase, (interest is paid on this in advance, so we get 12 months to sell our house).

 

We sell our house, pay back the £160K, get the mortgage sorted for the build, and pay off the balance of the land purchase of £90K. 

 

I know its not as simple as that, but can anyone see how this might not work ?? 

 

Its still cheaper then getting a builder to build our house, at their cost, and buy it off them at the end at market price,

 

 

 

 

 

If you are comfortable with the repayments on you BL

and your house is reasonably priced 

12 months is plenty of time to sell

your house 

More likely you will get your finances in place then find a buyer 

You only need one 

 

We sold out house the first weakens it was advertised 

Had we needed to sell to finish the build I wouldn’t have thought things would have been so straight forward 

 

It might not work if you can't sell the old house.  Why did the sale fall through.  The B word is creating a lot of uncertainty.

 

Being in the position of building without selling the old house, and the "sale" not (yet) going to plan, I would not want to be in the situation of paying a high rate bridging loan with an uncertain end date.

Oh errr, that sounds a bit convoluted. Are the sellers of the plot happy with stated payments? Otherwise as @nod says, as long as there is no strong reason why the last sale fell through that might revisit.

 

Perhaps it would be cheaper to get a buy to let mortgage for, say, 2 years.  The rates and fees ore competitive and there is a wide choice of lenders, especially at 60% LTV.

 

https://www.moneysupermarket.com/mortgages/results/#?goal=4&types=1&types=2&types=3&types=4&types=5&from=buy-to-let&to=results&term=2&method=1&borrow=150000&property=250000&page=1

Thanks for the reply, our buyers pulled out because their surveyor decided that our 140 yr old house was "falling down", chimneys falling off, road outside unsteady, needed rewiring, ventilation ducts unsuitable, this list goes on, and on and on. Fantastic surveyor giving worst case scenario. Surveyor described the movement as historic to me, but told our buyers it was recent, we've been here 11 years and its still the same. House was built in 1880. 

 

As it happens, he never looked at the chimneys, but took the bit of stained wallpaper on the chimney breast in the top bedroom as "chimney stacks need work", one of the cavity wall ducts was partly covered from a previous re-tarmaccing of the drive, so described them as unfit for purpose, told me we needed a new fusebox, told them it needed re-wiring, blah, blah, blah. 

 

But all things that between myself and our buyer, could have sorted out between us. 

 

Were having our own survey done, as there has been a little historic movement on the front bay windows (very slight cracking of pointing), have had an underpinning company in who have said its all ok, survey done tomorrow to give us the professional opinion. Then we'll have it rewired, and put it back on the market. 

 

Our buyer and his mother had both sold their houses, she was coming to live with them, so it was more an inconvenience thing that they pulled out as they didn't want to do this work after they moved in. 

Edited August 14, 20197 yr by Tonymac01

12 minutes ago, MikeSharp01 said:

Oh errr, that sounds a bit convoluted. Are the sellers of the plot happy with stated payments? Otherwise as @nod says, as long as there is no strong reason why the last sale fell through that might revisit.

Yes, we are buying off friends. 

12 minutes ago, MikeSharp01 said:

 

 

sounds like lots of ways it could go wrong 

what if next buyer uses same  or similar critical surveyor ?

what reduction in selling price of old house makes it look a a bargain and so sell quick  --could be the drop  in sale price  will be less than cost of bridging loan if it don,t sell quick ?

 or offer yuor friands selling the plot a fixed sum --that is not returnable as an option payment for the plot 

maybe you can agree something  like a 50% reduction in option fee if you complete  within so long ?

better to give money to friend than a bridging loan 

 

Edited August 14, 20197 yr by scottishjohn

Re the rewire.  Make SURE you get both the EIC and (if in England or Wales) the Part P certificate from the electrician. Make production of both of those a condition of the contract. Take copies to give to any buyer or surveyor that comes into the house. 

8 minutes ago, scottishjohn said:

sounds like lots of ways it could go wrong 

what if next buyer uses same  or similar critical surveyor ?

what reduction in selling price of old house makes it look a a bargain and so sell quick  --could be the drop  in sale price  will be less than cost of bridging loan if it don,t sell quick ?

 or offer yuor friands selling the plot a fixed sum --that is not returnable as an option payment for the plot 

maybe you can agree something  like a 50% reduction in option fee if you complete  within so long ?

better to give money to friend than a bridging loan 

The plan is to resolve the issues found with the first survey. 

£10k reduction in price, plus cost of rewire.

We had agreed at £460k from asking price of £485k on ours, so i thought with a fresh re-wire, clean bill of health, put it back at £475K, we might not be far off. 

£450K is our bottom line, so even if we got £460 next time, were still not far off, even with paying for a decent re-wire & surveyors costs. 

Quote

 

 

Edited August 14, 20197 yr by Tonymac01