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Want to take over my parents' mortgage-how do I start?
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# 1
LadyLiberty
Old 01-04-2010, 1:40 PM
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Default Want to take over my parents' mortgage-how do I start?

My parents have 5 years to go on their mortgage and although they can just about make payments my sister and I would like to help them by taking over the mortgage- I am guessing this means we have to get a mortgage and use it to pay our parents who will then pay off their bank.


How do I get started with this?

Sorry if this seems very basic.

Thanks
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# 2
getmore4less
Old 01-04-2010, 1:48 PM
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Easier to just give then the money to top up what they can pay.
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# 3
ukclarkkent
Old 01-04-2010, 2:05 PM
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Quote:
Originally Posted by getmore4less View Post
Easier to just give then the money to top up what they can pay.
that would depend on the interest rate of the existing mortgage perhaps?

does "owning" the mortgage means you then own the house?

as for answering the original question, i'd start with the current mortgage holder and ask them about changing the names. they might end up offering you a better mortgage as your earnings might be better...
i never get any comments about my lack of upper case. i really don't. yours will be the first ever.
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# 4
Cannon Fodder
Old 01-04-2010, 2:10 PM
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Do you have (or will you soon want) your own mortgage(s) ?

Your income(s) will need to support whatever combination of mortgage you currently have, as well as the one to buy the parents' house.

The sale price should not be too heavily discounted, as that could attract the attention of those interested in "deprivation of assets". Or potentially IHT should their deaths occur within 7 years.

You would need a deposit for the new mortgage. Clean credit histories etc. Same as any mortgae.

Helping rather than buying, might be simpler, but it has its dangers. If help is given in the expectation that it will be "inherited back" in due course, in the future the parents' care needs could see the disposal of their property to fund care home costs. At an average of around 26k per annum per person, a house's value can soon disappear, leaving the estate with nothing to "inherit back".

Going on the mortgage as an extra name might be enough to protect a portion of the house, subject to choosing Tenants in Common - but the parents need to agree to change from Joint Tenants etc - as does the Lender.

I think this is complex, and requires advice from a professional. Discuss with parents, plus solicitor/IFA/accountant, according to which you trust most with the details of the whole estate.
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# 5
ILW
Old 01-04-2010, 2:12 PM
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Quote:
Originally Posted by LadyLiberty View Post
My parents have 5 years to go on their mortgage and although they can just about make payments my sister and I would like to help them by taking over the mortgage- I am guessing this means we have to get a mortgage and use it to pay our parents who will then pay off their bank.


How do I get started with this?

Sorry if this seems very basic.

Thanks
Just make the payments for them. You should be able to arrange a direct debit from your bank to make the monthly payments.
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# 6
notisis
Old 01-04-2010, 2:26 PM
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That's what I do - have set up a standing order to pay the shortfall in the parents' payments each month. Very easy to do.
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