How much of a deposit do I need to buy a house in Liverpool?

How much of a deposit do I need to buy a house in Liverpool?

Why do I need a deposit?

For many people, saving for a deposit can be quite a challenge and is their main barrier to entering the property market. It can be seen as daunting if you have a family or are currently renting.

We get a lot of questions about deposits, so we’ll try to answer as many as we can here.

To reduce credit risk, lenders will require you to provide a deposit. If they lend you 100% of the purchase price and unfortunately you fall into arrears, they will have to take possession of the property. Things like that only take a small drop in housing prices to take a loss.

It’s a common thought that if you haven’t invested some of your money, or your family’s money, in your home, then it may seem too easy to “run away” if the going gets tough and you’re struggling to meet your monthly payments. Also, if you’re not able to save say 5% of the purchase price yourself, then it could be argued that you’re not quite ready to get on the property ladder.

My credit history is bad – how much do I have to pay?

Many of the specialist lenders we work with as a company want you to put down a minimum deposit of around 15% if you have bad credit. This is simply to reduce their risk in case of repossession. If you need specialist advice, please contact a mortgage consultant in Liverpool as we are here to help.

Can I withdraw a loan for a deposit?

It’s possible, but 99% of lenders won’t let you do this. This would essentially be 100% lending.

Can someone gift me a deposit?

Yes, this happens quite often. Usually the ‘Bank of Mum and Dad’ can gift the deposit, but other family members such as aunts, uncles etc have been known to. they do that too. However, the latter is not such a common option, so we wouldn’t take it as a guarantee. Prove who they are and confirm they’re not expecting a gift payout, then you’re good to go.

Please note that the above information is for reference only and should not be taken as personal financial or mortgage advice.

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