It’s becoming increasingly common for family to sell to other family members at a discounted price, this is called a concessionary purchase, you are able to save thousands of pounds by selling the property at a reduced rate, which means you need a lower deposit and lower total mortgage, leading to more affordable monthly payments, it’s also a great way to help family get on the property ladder.
Landlords can also choose to sell their property to long-term tenants for less than market value, which can avoid the stress and hassle of putting the property on the open market when they're ready to cash in on their investment. Plus, they can save thousands on estate agent fees as it would be a private sale.
Mortgage terms and interest rates for concessionary purchases will usually be similar to standard mortgages, the normal factors such as your income, credit history and personal circumstances will affect which lenders you can go to, but the bottom line is not all lenders accept concessionary purchases, this can mean that you as a borrower can tick all the boxes, but your situation doesn’t. On the surface, this doesn’t look like a problem, but if you have to go to multiple lenders it can lead to multiple credit check which will bring down your overall credit score, in turn limiting the available lenders even further, so it is vital to get the right lender first time.
At CLS Money, we can help you find a lender who will take the discounted purchase price into consideration and underwrite your agreement accordingly, eliminating the possibility of a tarnished credit score. Our brokers will find you the right deal and manage the entire application process from start to finish, leaving you to look forward to receiving the keys to your brand-new home!
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