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  • FIRST POST
    • Katloma
    • By Katloma 12th Jun 17, 11:26 PM
    • 2Posts
    • 0Thanks
    Katloma
    Stamp duty confusion
    • #1
    • 12th Jun 17, 11:26 PM
    Stamp duty confusion 12th Jun 17 at 11:26 PM
    Any advice would be greatly appreciated

    My partner is taking her ex partner off the mortgage and has been advised she has to remortgage. The remortgage has been accepted but in order for this to go ahead her mother has had to be put on the mortgage. Her mother already owns her own property and the sole reason for having to do this is she has not been in employment for a year yet so needed the second person on the mortgage. The second person will not be contributing to the mortgage not will they be living at the property and they are only needed on it for a maximum of 25 months. The main question is is stamp duty payable even though she has lived and had a mortgage on the property for over 15 years.

    Thanks for reading
Page 1
    • G_M
    • By G_M 13th Jun 17, 12:33 AM
    • 39,676 Posts
    • 45,192 Thanks
    G_M
    • #2
    • 13th Jun 17, 12:33 AM
    • #2
    • 13th Jun 17, 12:33 AM
    You have repeatedly referred to your partner, her ex, the mother "being on the mortgage".

    You do not say wheher these people are, or will be, registered on the property Title as owners as well.

    In most cases, mortgage lenders insist that the names on the mortgage must match the registered owners' names - but not always. Some lenders will allow someone to be 'on the mortgage' but not a registered owner.

    Will this apply to her mother?

    If her mother is going to be a registered owner as well as on the mortgage, then she (mother) will own 2 properties, and the additional SDLT will apply. The fact that one of the owners has only one property is irrelevant.

    If her mother is not going to be an owner, just a mortagee, then the extra SDLT would not apply.

    Would the mortgage lender accept her mother as a 'guarantor' rather than as a joint mortgagee?

    What about using a different mortgage lender - have you seen an independant mortgage broker?

    If her mother IS going to become a joint owner, then as well as having to pay the extra SDLT, has she considered whether they will own as Joint Tenants or Tenants in Common?
    Last edited by G_M; 13-06-2017 at 11:17 PM.
    • Katloma
    • By Katloma 13th Jun 17, 3:32 AM
    • 2 Posts
    • 0 Thanks
    Katloma
    • #3
    • 13th Jun 17, 3:32 AM
    • #3
    • 13th Jun 17, 3:32 AM
    Thank you for your reply. Sorry that my post didn't contain enough information (late night posting)
    Yes her mother will be the registered owner aswell. Not seen an independent brooker. I don't know about the joint tenants or tenants in common I will make sure I ask. Is there a difference?

    Thank you again for taking your time to reply
    • TrickyDicky101
    • By TrickyDicky101 13th Jun 17, 8:12 AM
    • 2,595 Posts
    • 1,692 Thanks
    TrickyDicky101
    • #4
    • 13th Jun 17, 8:12 AM
    • #4
    • 13th Jun 17, 8:12 AM
    How much is the total mortgage (ie not just the element the mother will be 'contributing' to)? If it is in excess of £80k (so mother's element is >£40k) then additional rate SDLT will need to be paid on mother's element (@3%).

    If total mortgage is >£250k then normal SDLT will also apply to mother's portion in excess of £125k.
    • AdrianC
    • By AdrianC 13th Jun 17, 8:18 AM
    • 14,433 Posts
    • 12,756 Thanks
    AdrianC
    • #5
    • 13th Jun 17, 8:18 AM
    • #5
    • 13th Jun 17, 8:18 AM
    My partner is taking her ex partner off the mortgage and has been advised she has to remortgage. The remortgage has been accepted but in order for this to go ahead her mother has had to be put on the mortgage. Her mother already owns her own property and the sole reason for having to do this is she has not been in employment for a year yet so needed the second person on the mortgage. The second person will not be contributing to the mortgage not will they be living at the property and they are only needed on it for a maximum of 25 months. The main question is is stamp duty payable even though she has lived and had a mortgage on the property for over 15 years
    Originally posted by Katloma
    If it helps you understand the situation, the ex-partner is SELLING his share to the mother.
    • kingstreet
    • By kingstreet 13th Jun 17, 9:01 AM
    • 31,463 Posts
    • 16,814 Thanks
    kingstreet
    • #6
    • 13th Jun 17, 9:01 AM
    • #6
    • 13th Jun 17, 9:01 AM
    A broker would have told them about joint borrower/sole proprietor lenders which would have meant mother didn't become an owner and avoided the SDLT surcharge trap.

    There are lenders happy to take someone starting a job today. 12 months is an excessive length of time these days.

    Someone is allowing themself to be dictated to by lender criteria instead of getting the best they can by seeking independent advice.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • G_M
    • By G_M 13th Jun 17, 11:22 PM
    • 39,676 Posts
    • 45,192 Thanks
    G_M
    • #7
    • 13th Jun 17, 11:22 PM
    • #7
    • 13th Jun 17, 11:22 PM
    Thank you for your reply. Sorry that my post didn't contain enough information (late night posting)
    Yes her mother will be the registered owner aswell. Not seen an independent brooker. I don't know about the joint tenants or tenants in common I will make sure I ask. Is there a difference?

    Thank you again for taking your time to reply
    Originally posted by Katloma
    I have yet to come across an initial post on this forum that contains all the required information!

    An independant broker can
    * explain the SDLT rules
    * explain the options
    * advise on which mortgage lender might accept her on mortgage but not as registered owner
    * advise on which mortgage lender might accept her as guarantor
    * etc

    For the difference betweenJoint Tenants or Tenants in Common (yes it IS important!), click the link!
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