Selling and buying house concurrently and the 10% dilemma

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10% John

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Hi Brendan,
I am selling my house and buying another house at the same time. With the equity from my house sale and personal savings plus new mortgage approval I have enough to complete new purchase.

Normally I think you sign both sale and purchase contracts at the same time about 3 weeks before closing and will be required to paying a 10% signing deposit but I will not have the proceeds of my sale nor will I have my mortgage drawn down at that stage.
I have some savings but not enough to make up the 10% signing amount normally required. In summary I have a timing problem.

Questions?:
Will my mortgage provider PTSB advance me part of my mortgage for the 10% with the remaining 90% to follow on closing,
or do I need to get bridging finance through another finance house,
or do I ask my solicitor to request to pay less than 10% to the purchasing solicitor as I have some savings,
or do I have to close the sale of my property, get in all my funds and try for a short term rental which I dont think possible under the current short term rental market to enable me to have funds for signing,
or is it possible to sign and close both sale and buy on the same day with the 100% changing hands that day?
 
As above, talk to the vendor's agent and let them know the situation and get the solicitors talking about timing both transactions together. It is possible to close both on the same day but it requires all parties and their solicitors to be motivated to do so.

That will see you in a chain where you can't complete on your purchase until your current place is sold. IF the house you are looking to purchase is in high demand. The vendor might not want to take on the risks of delays or issues with your sale affecting their plans. When I last moved, we arranged mortgage approval on the basis of renting out the current property so that we could close on the purchase before later selling the other one. With less than 10% of the purchase price you might not have the flexibility to pull that one off though as you do need to be able to service two mortgages for a time.
 
I'm not sure talking to your bank will do much good, they're not going to release any funds from a mortgage prior to the sale closing and any other finance you obtain to fund the deposit would impact on the affordability calculations for the new mortgage, banks don't do bridging finance any more.
 
Leo said:
As above, talk to the vendor's agent and let them know the situation and get the solicitors talking about timing both transactions together. It is possible to close both on the same day but it requires all parties and their solicitors to be motivated to do so.

That will see you in a chain where you can't complete on your purchase until your current place is sold. IF the house you are looking to purchase is in high demand. The vendor might not want to take on the risks of delays or issues with your sale affecting their plans. When I last moved, we arranged mortgage approval on the basis of renting out the current property so that we could close on the purchase before later selling the other one. With less than 10% of the purchase price you might not have the flexibility to pull that one off though as you do need to be able to service two mortgages for a time.
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Yes I'll look at the rental before closing with bank also.much appreciated.
Leo said:
I'm not sure talking to your bank will do much good, they're not going to release any funds from a mortgage prior to the sale closing and any other finance you obtain to fund the deposit would impact on the affordability calculations for the new mortgage, banks don't do bridging finance any more.
Click to expand...
Thanks for knocking that option off list.
 
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