Can I use the difference between past and current value of the property as deposit ?

No it isnt.
It is about finding the lender. No lender will do it.

It is too complicated to explain why it can not be done, but the long and short of it is that there is not much profit in mortgages for lenders, so they like to keep things nice and simple. This is anything but.

Its down to you if you want to spend more time trying to do it, but I wont be replying anymore.

dtr83 wrote: »

Ifvproperty was worth 150k - years ago when landlord get interest only loan - is mean he can buy it now at an ttime for 150 regardless of the current market value - is yhat correct ?

No, that's not correct. Your landlord has already bought the property. It belongs to him, not the bank.

The current value of the property is irrelevant to the amount your landlord owes the bank. If he has an interest only mortgage for £150k, he'd still owe that amount if the property value fell to £0k - or if it rose to £1 million.

If your landlord chose to sell the property, then he'd have to pay off mortgage loan first, then he'd keep all the rest of the money*. So, if the property is worth £200k, he'd walk away with £50k in his hands, and no further debt to anyone.

If your plan was possible, and if your landlord agreed, he'd be selling you 75% of the property. But he wouldn't get any cash in his hand, because he'd still have £50k of his money as equity in the property. He'd still owe £150k to the bank (or possibly to a different bank), but now his mortgage would be joint with you. So he'd still be on the hook for all the debt he owed before, but he'd no longer benefit from the capital appreciation on the 75% you'd bought. Plus he'd have the risks of merging his credit record with yours.

Ultimately, if your landlord wants to sell, he'll want to sell the entire property. If he doesn't, then he'll want to get rent and capital appreciation on the entire property. The only exception would be if he fancied going into business with you and running a property partnership - but given the imbalances in your financial situation, I can't see why that would be attractive to him.

(*I'm ignoring tax here; I don't think tax has anything to do with why it'd be crazy for a landlord to do this. I'm also ignoring LTV covenants, and a bundle of other things).

Despite what you may think, give up on the idea.