Joint Mortgage HELP!

Ms_Dalton

Hi, if anyone can offer me any advice id be grateful.

heres the situation.

My brother and I bought a house 4 years ago for £70k. There is approx £66k left to pay on it. After a huge arguement my brother wanted me to buy him out, i offered him £15k but he said no and we put the house up for sale. I dont want to move from the house or the area as i am really happy where i am.

hes agreed to take £8k now. My mortgage is with First Trust and the rate is really low - my brother has moved out but still pays half of the mortgage. i understand he is paying for something he isnt using. So i was going to re-mortgage and get £8k added to the mortgage - First Trust keep changing their 'lending rules' I earn £20k a year and thought this would be enough as i can afford the mortgage at present on my own - i suggested to my brother to stop paying his half of the mortgage and i can pay it myself but he says this is illegal!

i want to stay with First Trust as it has a really low rate, if i go somewhere else then it will end up costing a fortune!

anyone got any ideas what to do?

Trying_to_be_good

It's not illegal for your brother to stop paying half the mortgage,but if the account goes into arrears they will chase him, as well as you, for the debt.

You need to weigh up whether to jump through the hoops to the the First Direct mortgage in your sole name, go to another lender, or stay with your brother on the mortgage (whether or not he's paying - you could get a legal document drawn up to say he has no claim on the house if you're buying him out in all but name) - this would prevent him from getting another mortgage.

getmore4less

Whats the place worth?

That the first thing you need to establish to try to determines a fare buy out cost.

If you bought 50:50 then he should get 1/2 the net procedes from a sale and them pay off his share of any debts.

Lets asume it is worth £70 still then thats £4k equity so after cost he would get probably about £1k-£1.5k


If he has moved out and is paying 1/2 the mortgage then you could pay him 1/2 the market rent so he keeps ownership but but gets a fare return from his asset.

Ms_Dalton

Get more for less
My brother is happy to take £8k just to leave the house. it was on the market but as i didnt want to sell i told him that the house could sit on the market for months and he would maybe end up with very little money and also its not fair on me as i wouldnt have enough for a deposit anywhere.


Trying to be good
It's not illegal for your brother to stop paying half the mortgage,but if the account goes into arrears they will chase him, as well as you, for the debt.

You need to weigh up whether to jump through the hoops to the the First Direct mortgage in your sole name, go to another lender, or stay with your brother on the mortgage (whether or not he's paying - you could get a legal document drawn up to say he has no claim on the house if you're buying him out in all but name) - this would prevent him from getting another mortgage.

if i was to get a document drawn up saying he has no claim on the house does this mean he wont be able to get a new mortgage until i have his name off the joint mortgage? I just thought it was a case of removing his name from the mortgage and the deeds and it would be pretty simple and borrow £8k from the bank. but its not as easy as it seems!