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Buying a house no deposit

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  • 20-02-2019 9:15pm
    #1
    Littleredcar
    Registered Users Posts: 184 ✭✭


    Currently looking at trading up . I have zero as in totally zero savings but will have equity of around 320 going into sale of house around 420. Have been approved for mortgage. How do I get around deposit at signing contract stage


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    #2
    Dublindamo
    Registered Users Posts: 33 ✭Dublindamo


    Sell before you buy


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    #3
    GingerLily
    Registered Users Posts: 4,767 ✭✭✭GingerLily


    Your equity will count as your deposit provided you close that sale before you purchase, it can be the same day even.


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    #4
    Littleredcar
    Registered Users Posts: 184 ✭✭Littleredcar


    Selling before I buy isn’t an option 2 kids and a pensioner coming with me .


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    #5
    Samuel T. Cogley
    Registered Users Posts: 10,684 ✭✭✭✭Samuel T. Cogley


    GingerLily wrote: »
    Your equity will count as your deposit provided you close that sale before you purchase, it can be the same day even.


    And frequently is.


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    #6
    Littleredcar
    Registered Users Posts: 184 ✭✭Littleredcar


    Samuel T. Cogley wrote: »
    And frequently is.

    Is this even with solicitor


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    #7
    Samuel T. Cogley
    Registered Users Posts: 10,684 ✭✭✭✭Samuel T. Cogley


    Littleredcar wrote: »
    Is this even with solicitor

    It's called a chain. You're not as attractive as a non-chain buyer but you'll usually find several houses are all changing hands on the same day when you buy.

    You'll need a solicitor.

    Booking deposit might be an issue though.


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    #8
    boege
    Registered Users Posts: 469 ✭✭boege


    Littleredcar wrote: »
    Selling before I buy isn’t an option 2 kids and a pensioner coming with me .

    My parents did this many years ago when there was seven kids plus a pensioner. We were spread across relatives for about 6 weeks while purchase of new was closed. Have fond memories of having stayed with cousins.


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    #9
    Littleredcar
    Registered Users Posts: 184 ✭✭Littleredcar


    boege wrote: »
    My parents did this many years ago when there was seven kids plus a pensioner. We were spread across relatives for about 6 weeks while purchase of new was closed. Have fond memories of having stayed with cousins.

    Not an option no other relatives


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    #10
    Littleredcar
    Registered Users Posts: 184 ✭✭Littleredcar


    Samuel T. Cogley wrote: »
    It's called a chain. You're not as attractive as a non-chain buyer but you'll usually find several houses are all changing hands on the same day when you buy.

    You'll need a solicitor.

    Booking deposit might be an issue though.

    Getting a bit worried


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    #11
    Mrs OBumble
    Registered Users Posts: 25,723 ✭✭✭✭Mrs OBumble


    Littleredcar wrote: »
    Not an option no other relatives

    AirBnB a place for few months if necessary.


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    #12
    kerdiff
    Registered Users Posts: 156 ✭✭kerdiff


    I moved from one house to another last year and didn't need a deposit as the equity was used as a deposit.


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    #13
    [Deleted User]
    Posts: 14,344 ✭✭✭✭ [Deleted User]


    Given the situation, could you not just get a personal 'car' loan or something to get 5-10k into your back pocket short term?


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    #14
    ontheditch2
    Registered Users Posts: 372 ✭✭ontheditch2


    Could you not rent a place short term water selling your own place; if the other house is not yet available. Everything will be boxed up, just take things you will definitely need for a few weeks/ months.
    Often heard of people renting for a year between houses or when doing up a house


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    #15
    Mr. Grieves
    Registered Users Posts: 781 ✭✭✭Mr. Grieves


    Buying/selling on the same day is normal.

    You will need to find the cash for the booking deposit. Your solicitor may be able to negotiate a reduction in the size of this deposit. As it's only held between contracts being signed and the sale going through, you'll only need the money for a few weeks, so maybe you could borrow from a relative? Talk to your solicitor about all of this.


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    #16
    xalot
    Registered Users Posts: 1,092 ✭✭✭xalot


    We did this recently, AIRBNB for two weeks with all belongings in storage. Had aimed for a same day close but buyers (and their solicitor) messed us around, not ideal but workable.


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    #17
    C3PO
    Registered Users Posts: 3,742 ✭✭✭C3PO


    As others have suggested, selling first would make more sense if you have zero available cash! As well as a booking deposit you will also need money for other (not so incidental) incidentals ... like moving expenses, closing utility accounts etc! Take a short term rental to tide you over.


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    #18
    BnB
    Registered Users Posts: 1,081 ✭✭✭BnB


    Would you not get a bridging loan to cover the deposit until your own house is sold.

    The bank that you are getting the mortgage from might be able to set it up for you. Otherwise you could look elsewhere.


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    #19
    lawred2
    Registered Users Posts: 24,293 ✭✭✭✭lawred2


    How are you planning on covering legal fees, moving costs and stamp duty?


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    #20
    GingerLily
    Registered Users Posts: 4,767 ✭✭✭GingerLily


    BnB wrote: »
    Would you not get a bridging loan to cover the deposit until your own house is sold.

    The bank that you are getting the mortgage from might be able to set it up for you. Otherwise you could look elsewhere.

    Bridging loans are not very common these days, I haven't heard many banks issuing loans like this for quite a while


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    #21
    Lolle06
    Registered Users Posts: 235 ✭✭Lolle06


    AFAIK in a chain situation in the UK, the deposit is getting handed up the chain. I.e. your Buyer will pay his deposit to your solicitor, you then will pay your deposit to your vendors solicitor, etc. In Ireland the deposits are taken straight away by the EA though, usually 7% to 10% of purchase price. Could you offer at least a small amount to cover the EA costs (they are taking their fee from the deposit) and pay the rest via the solicitor at exchange of contracts?


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    #22
    Mike3549
    Registered Users Posts: 933 ✭✭✭Mike3549


    Lolle06 wrote: »
    In Ireland the deposits are taken straight away by the EA though, usually 7% to 10% of purchase price.
    No, you only pay a booking deposit to EA which is approx 5k (well at least it was a norm when we bought 5yrs ago)


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    #23
    Dublindamo
    Registered Users Posts: 33 ✭Dublindamo


    Mike3549 wrote: »
    No, you only pay a booking deposit to EA which is approx 5k (well at least it was a norm when we bought 5yrs ago)
    Correct. You will pay a booking deposit if 5 to 10k depending on value if house to the estate agent. They hold onto this and upon closing take their fees from this.
    You then usually would have to pay a deposit to vendors solicitor of 10% if ftb and 20% if not. The balance would be then via a mortgage. As your solicitor deposit is made up of equity you would need your solicitor to negotiate with sellers solicitor. You seem very early in the process so I suggest you speak with a broker and solicitor to work out next steps. Good luck


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    #24
    Littleredcar
    Registered Users Posts: 184 ✭✭Littleredcar


    [Deleted User] wrote: »
    Given the situation, could you not just get a personal 'car' loan or something to get 5-10k into your back pocket short term?

    Not s bad idea . I have about 420 to spend on second house but am planning on holding on to 80/100 for works on the new house. So while I have equity I have no cash


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    #25
    Littleredcar
    Registered Users Posts: 184 ✭✭Littleredcar


    Littleredcar wrote: »
    Not s bad idea . I have about 420 to spend on second house but am planning on holding on to 80/100 for works on the new house. So while I have equity I have no cash

    Renting short term is not an option the pensioners health is not good so would not expect them to rent


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    #26
    antiskeptic
    Registered Users Posts: 9,555 ✭✭✭antiskeptic


    Littleredcar wrote: »
    Renting short term is not an option the pensioners health is not good so would not expect them to rent

    A booking deposit is returnable to you, without questions asked, right up to the point you sign contracts. Once you sign contracts the sale closes within a week or two.

    In other words, the booking deposit has no actual value to the estate agent or vendor until right before the close.

    I don't see why either should get particularly sticky about it - given the circumstances. You have solid financing in place.

    Now the agent might fear that without his holding the booking deposit the vendor could clear off and he not get his fee - but I'm sure it's possible for the solicitors to arrange that the estate agent be paid his cut directly from purchase funds on closing date, the rest going to the vendor. A letter from the vendor directing same would be all that is needed.

    Like, an executor sale will frequently see the solicitor divvy up the proceeds according to a will and sending them to the various benefactors. It's just a matter of binding instructions being given.


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    #27
    catrionanic
    Registered Users Posts: 2,091 ✭✭✭catrionanic


    We did this recently, but we did have some savings. We had to pay a booking deposit, but negotiated to pay 5% rather than 10%. We also needed money for moving expenses.

    We tried to complete same day but solicitor advised that we leave a few days in between, because both houses had mortgages to close. In the end, we had 5 days between selling our own house and moving into our new one. We had a one year old and a 3 week old baby, and ended up splitting the family in half and staying with different relatives for those days.


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