Trick to paying less than a 30% deposit as a foreigner - house purchase

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dingobingo
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Trick to paying less than a 30% deposit as a foreigner - house purchase

Postby dingobingo » Tue Mar 12, 2019 7:53 am

Hey folks

On a recent house inspection visit I was chatting to the agent's translator (agent not present) during a meeting with a mortgage broker. He showed me an example system of in effect paying less deposit.

Let's say the house is 100k, normally requiring a 30% deposit. Obtain a mortgage on a 100k valuation but actually offer the vendor 80. Assuming the offer is accepted, 70k is borrowed from the bank and 80k paid to the vendor meaning the deposit required is only 10k, not 30k.

This would be impossible in the UK but he seems to indicate it was normal in Spain. The mortgage broker didn't contradict him.

But when I mentioned this as a possibility to the agent he said he'd never heard of this and it would be impossible.

What's going on here? Thanks all.

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gerryh
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Re: Trick to paying less than a 30% deposit as a foreigner - house purchase

Postby gerryh » Tue Mar 12, 2019 8:44 am

I thought the normal was to pay a 10% deposit to confirm/ start the purchase process?
That is all I paid.
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Gerry
Gerry Harris

El Cid
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Re: Trick to paying less than a 30% deposit as a foreigner - house purchase

Postby El Cid » Tue Mar 12, 2019 9:19 am

Yes, as a normal purchase deposit 10% is normal, but here we are talking about mortgage deposits.

Sid

katy
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Re: Trick to paying less than a 30% deposit as a foreigner - house purchase

Postby katy » Tue Mar 12, 2019 3:18 pm

10% is the norm but total of 30% is due in a matter of weeks. This is how the large operators got their finance to build (or not in many cases). Remember AIFOS who were taking 30% deposits before they had even purchased the land in some cases. Many Spanish lost money too so they obviously didn't do it. How could you get a bank guarantee if no paperwork for the 30% payment...or am I missing something?


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