Buying house with inheritance or mortgage

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I posted in legal about the inheritance side of things but thought I would post here for some additional advice please. I have inherited part of a house. The executor is dealing with it all and will divide the proceeds accordingly with the sale. There is a buyer in place.

I would like to buy my own house asap especially as the stamp duty holiday has now been extended until end of June and I am viewing several houses this week. Problem is how do I show evidence I am receiving funds from inherited house? If I provide a letter from executor and that is sufficient I am also a bit nervous about relying on the sale of this inherited property as there have been a few delays. There is a buyer lined up though but exchange might not be till next month or onwards. This makes me a bit nervous about making stamp duty holiday deadline. Alternatively, instead of relying on inherited property I could take out a high mortgage which could be more reliable in getting funds now but then I could have to incur all associated costs and pay a early repayment charge when I am able to pay off whole mortgage (once property sale comes through). Or another type of loan? Or would you think because we have a buyer for inherited property the sale should go through before end of June (unless they pull out). Thanks in advance!

Look at mortgages with no early repayment fee then remortgage / pay it off outright once inheritance comes through.

There are bridging loans specifically for this type of situation - sorry I don't know more

Get the mortgage and choose a mortgage product where you don’t incur erp or costs to fix later (tracker mortgages ideally). You can pay a lump sum and fix it at a later date if you so wish

Part of our deposit was an inheritance and we had to show the executor's letter with the exact amount inherited, which comes after everything is sold, once we were at the solicitor's getting involved stage so the previous recommendations of options you can pay off with the inheritance may work out faster.

For inheritance a Solicitors's letter should be sufficient.

Do you have a sufficient deposit without the inheritance and would you be able to obtain a mortgage on your income?

For a mortgage - have you looked at offset mortgages? You could use it to buy and then when you get the money you could offset it against the mortgage.

How much of a Stamp Duty reduction are we talking about? Is it worth getting yourself into potential financial trouble for?
There's many a slip twixt cup and lip. Wait until the money is actually in your hand. You will then be a bona fide cash buyer and may be able to haggle down prices.

How much would you save in stamp duty? Find a mortgage with an early repayment charge lower than your saving and overall you will be better off.

If I bought a new house now I'd be paying nothing on stamp duty so saving approx £10,000 under usual circumstances.

I could obtain a mortgage for the house purchase (also have big deposit) but need to look into mortgages without early repayment charges in case inheritance does not come through in time. If anyone has any recommendations please let me know.

Are you actually inheriting a house - i.e your name will be put in the deeds as the new owner - or are you inheriting the proceeds of the house as part of the estate?

I have no idea of the answer to this question, but if you are inheriting the money from the sale of the house, handled by the executor, who will give you the money, not the house, does that not make you a first time buyer?

In which case you won't pay stamp duty on the first £300.000 of purchase price, even after the June deadline. FTBs are exempt.

If you are not counted as a FTB, beyond the June deadline there is a halfway measure - you don't pay stamp duty on the first £250,000 of the price.

So depending on whether you are a FTB, and on the price of the house you would like to buy, you may not pay any or much stamp duty anyway.

I think you could really struggle to complete by the end of June. You might be lucky, if you find a property that is chain free and empty, if the searches come back quickly (they are taking ages) , that you can find a solicitor ready to help you try (many have cancelled holiday to meet the current frenzy and will have lots of staff on hol after easter), if the inherited house sells quickly and probate happens quickly, OR if you go the mortgage route, you find a house for which the lender finds no quibbles, case for retention or works to be done, etc, and if their solicitor moves quickly.

As a cash buyer you will be in a far stronger position to make offers. Vendors like a cash buyer - not lender to impose conditions and be slow.

I would avoid all the costs associated with getting a mortgage, the stress of trying to beat the stamp duty deadline, and wait until you can proceed as a cash buyer.

Thanks @RainingBatsAndFrogs perhaps you are right. I do feel a bit stressed in thinking about trying to beat this stamp duty deadline. I'm not a FTB and would probably save about 10k buying now but like you have said it probably isn't worth the stress.... I agree, I will be in a much better position as cash buyer and will avoid all the time worrying about either the inherited house sale going through or getting a high mortgage.

Have a look at an offset mortgage, My sale hadn’t completed when I bought my current property. Using my offset mortgage once the house sold i simply hold the money in the linked savings account.

Why do you want the partly inherited house OP?
Would it be your normal choice of purchase?
You might hold things back in legal terms. It might be better to treat the inheritance as a separate issue to meeting the stamp duty deadline?

I wouldn't take out a bridging loan It's a bit too risky if the sale is delayed or the buyers drop out. I think I'd either wait until I had the money or if I couldn't wait I might look into the bigger mortgage but with no penalties for repayment of a lump sum. But maybe you will still need a deposit. I think I'd wait.

@Viviennemary

I wouldn't take out a bridging loan It's a bit too risky if the sale is delayed or the buyers drop out. I think I'd either wait until I had the money or if I couldn't wait I might look into the bigger mortgage but with no penalties for repayment of a lump sum. But maybe you will still need a deposit. I think I'd wait.

And bloody expensive