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Charge on house
novazombie
Posts: 327 Forumite
If someone lends someone else some money to buy a house, can there be a charge on the house for %age of the property? Instead of just a normal charge for an amount of money.
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Comments
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Good question. The answer is no.0
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Not via a charge - but a declaration of trust to show who owns what would cover it.Warning ..... I'm a peri-menopausal axe-wielding maniac
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If someone lends someone else some money to buy a house, can there be a charge on the house for %age of the property? Instead of just a normal charge for an amount of money.Good question. The answer is no.
Why not? I cannot think of any legal reason why this cannot be done. Housing Associations do equity sharing loans for a percentage of value and some builders are doing this now, so why can't a private individual?. Just a matter of wording the charge document.
Of course a family member lending money to provide the difference between the price and the mortgage. The bank or building society as first mortgage lender may not be so happy to lend as it may show the borrower has not been financially prudent and saved. The lender may not agree to the registration of a second charge in favour of the family member, but there is no reason in principle why a charge cannot be for a percentage of the price or value.RICHARD WEBSTER
As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.0 -
Richard_Webster wrote: »Why not? I cannot think of any legal reason why this cannot be done. Housing Associations do equity sharing loans for a percentage of value and some builders are doing this now, so why can't a private individual?. Just a matter of wording the charge document.
That's a good point, Richard. I think some of us (well .... erm ... me actually) thought that the intention was give the person wanting the charge some "ownership". But it could be that they just want the debt repaying on sale
Warning ..... I'm a peri-menopausal axe-wielding maniac0
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