Mortgage and incentives

[steveball]

Buying a new house from a major builder, it's a stock property which includes flooring throughout a fridge freezer plus a dishwasher - which they value at £3000

3 weeks after signing up they have decided these are now an incentive, we got £1000 towards fees as an incentive to start with. Our mortgage company said as we got the £1000 the house was worth £1000 less therefore the mortgage value was this amount less.

We already have a mortgage in principal etc - does the £3000 work as same as the cash value of £1000 above? As we didn't chose any of the items, and as far as we are concerned they are used, due to previous prospective buyers touching them etc, yes this may seem petty but it's part of my argument. They are not mentioned on any paperwork as incentives, however only the kitchen appliances are listed as included.

We don't want to have to find the extra £3000 in 2 weeks for our extended deposit, but are happy to listen to anyone's advice - even if it doesn't go our way. Oh they wont rip the extras out before anyone asks.

[Sarnie]

They are incentives.

You (and your Solicitor) are legally obliged to disclose these to the lender.

If you are unsure, call the lender without giving your name and ask them whether they deem items like these to be incentives......

[steveball]

Thanks Sarnie, Do mortgage companies usually take this off the value or is it pot luck?

[Sarnie]

steveball said:

Thanks Sarnie, Do mortgage companies usually take this off the value or is it pot luck?

If it's an incentive then yes they do..........its not part of the property purchase........otherwise they would be securing part of their mortgage against a fridge......

[Chris Type R]

Sarnie said:

otherwise they would be securing part of their mortgage against a fridge......

... and they might freeze the funds.

[Jockman]

Cool

[steveball]

Thanks for all the replies - it looks like I have an argument on my hands

[Jockman]

What did the lenders survey value the property at?

[steveball]

They haven't been out yet - would this change things?

People on the same estate have paid between £210,000 and £220,000, ours is £199,995 as it's the last one.

[Jockman]

Perhaps but most likely not.

You don't technically know the size of your deposit as they haven't yet determined an LTV. The surveyor however will be on the lender's panel and rarely do they stray from their brief of say £196k in this instance.

You at least have some wriggle room if you can show the recent sales nearby but Sarnies your man for direct advice.

[Harbuzi]

Some lenders will allow up to 5% of purchase price as incentives without it affecting what they will lend. This happened with us with Nationwide. I was told by my mortgage advisor at the time that other lenders are less amenable (Natwest or Halifax I think from memory).