Soon to inherit a property - can it help current mortgage without selling?

RedPing1977

Hi all, I'm booking in to see a mortgage advisor over the next two weeks on this...I just wanted to throw it out here for any advice in the meantime.

I'm currently on NR SVR with my residential mortgage. Unfortunately in negative equity. Outstanding mortgage is £184,000. I estimate the current value of my property to be approx £170,000. No chance of a decent fix soon then!

I'm about to inherit my parents property, current value 90K - 100K I'd say, with no outstanding mortgage. They'll continue to live there for a few months more before moving to another property.
They're happy to sign it over to me early if it can help out our current situation with NR. I'd rather not sell it until prices pick up to be honest.

Question is, could I re-mortgage the new property with the aim of raising cash to buy own home out of negative equity? Hopefully get the LTV down to a healthy 75% or for for a decent-ish long term fix?
I'd be paying the same amount of loan, just spread over two houses. Say 60K on one & £125K on the other.
BUT crucially both of them (hopefully) at a decent long term fix for piece of mind.

Is any of this even possible?

bigstevex

I presume you could just re-mortgage your parents house so you have just enough to take your mortgage down to a level where you could fix it! Thats not advice though....someone else can provide that as to whether its a good idea :eek:

Fire_Fox

If you own the house but don't live in it, when you sell it you will have to pay capital gains tax (I think). Might be best to see a financial advisor or solicitor about the whole plan?

Robert_Sterling_3

Definition of Inherit:-

To obtain from somebody after their death.

RedPing1977

Robert_Sterling wrote: »

Definition of Inherit:-

To obtain from somebody after their death.

:rolleyes:

Ok let's forget the 'Inherit' word and say that they're going to 'GIVE' me the property instead.

Any financial advisors on here with advice I'd love to hear a solution to my predicament.

Many thanks.

dimbo61

Is the house fit to let out and if so could you take out a BTL mortgage and use that to clear some of your mortgage debt on your home.

luckyfool

Once they have moved out you could get a decent BTL rate on it at 50-65% and use the money raised to overpay your NR mortgage.

Make sure you speak to your solicitor/IFA about inheritance tax and the rules. If your parents were to pass away within 7 years of giving you the house then there could be an inheritance tax liability.