Looking for advice on Trading Up

S

smndly

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We are looking at trading up our home this year and I just wanted to outline our plan/schedule to see if anyone can see any issues or ways to do things more efficiently as it seems fairly challenging to manage to do this seamlessly!

In addition we do not have a 10% cash deposit available as we overpaid the mortgage significantly instead of savings. We have significant equity however in our house and will be looking at a mortgage c. 75% LTV. Therefore I believe we will need to sell and release equity prior to purchase.
Our schedule is:
  • Get BER and engage Estate Agent and solicitor to sell house.
  • In tandem, get mortgage AIP using broker
  • We are thinking it makes sense only to list our house for sale after we get AIP in the event there is some issues getting AIP.
  • List house for sale
  • When our house is on market actively search and bid on houses. I hope we would be taken seriously by estate agents once our house is on the market.
  • IF our house is sold we could move in with relatives but would like to keep this as brief as possible.
  • Hopefully buy new house and move in all within a year from now.
It looks difficult to get all of this done in one go but hopefully it works out.

Has anyone traded up like this recently and able to steer us in the right direction?
 
We are in the middle of it right now, same position as you. Get an "Opinion on Compliance Cert" on your house as well as a BER. Then we followed the exact same steps as you propose but we went Sale Agreed, then 2 weeks later Sale Agreed on new property. Would find it too risky to sell ours and then buy a year later. The rent would be far too high for starters and eat into our funds.

The 10% deposit at signing of contracts is a stumbling block, many would not have that type of cash on demand. If you have manged your money well you would have used excess cash to pay off your mortgage or directed to a pension. To me that advisory is ok when you are a FTB but not for 2nd time buyer, equity should be taken into consideration. In the UK the deposit you receive from your buyer can be used against your deposit.
 
As soon as you list your house for sale, instruct your Solicitor to request your house deeds from bank. Depending on your bank, it can take a few months for them to come through.
 
Get quotes for mortgage protection insurance for the new mortgage, particularly if any personal circumstances have changed since you took our your current one.
 
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