Buying property with a relative

Urban_chameleon

Hi everybody,
I have a question about buying property with another person.
I have some money I’d like to invest but am not in a position to get a mortgage at the moment (I'm on a one-year work contract). My sister was buying her home with her partner and he has now left her and left her to pay the mortgage (charming!).

Anyway, I thought of possibly buying the house with her. She’d continue living there and I would see it as an investment. The wierd situation would be that we are both owners and that she is the tenant. I want to give it some careful thought before speaking to her about it. I want to be sure that it is the right thing for me before I bring up the topic with her.

Obviously, we'd draw up some sort of contract but here are the things I want to consider before I even speak to her about it. Does anybody have ideas / answers / suggestions / thoughts on other things I should consider? Do you think such a partnership could work? Or am I being unrealistic?

What happens if one of us can’t make mortgage repayments?
What happens if one of us wants to sell?
How to share out costs? And any profit we make?
How to share out the costs of what is relevant to the owner (both of
us) and what is relevant to the tenant (sister).
Finally, I guess I'm right in thinking that i can't get a mortgage with just a one-year work contract.

Thanks to everybody

lincroft1710

Just ask what she thinks of the idea, if she agrees that is first hurdle cleared.

Your post doesn't make it clear, but I am assuming that mortgage is joint between sister and sister's ex and he is joint owner. If so, his interest has to be "bought" out. This is second hurdle, property may be in negative equity, which means ex may not be entitled to any money, but lender may require as much as 20% deposit for new mortgage. Third hurdle will be whether you and your sister will jointly qualify for mortgage, so first ask existing lender.

If you have cleared all these hurdles, you can then consider how you should agree things between you.

Urban_chameleon

Thanks Lincroft,

that's a great help!

ian.bathgate

dont do it what if you fall out
i did it and my brother in law forged my signature to transfer the house into his name at the land registry

chickmug

I fully agree with the don't do it.

I have seen too many cases of this where an acrimoneous 'end result' is the outcome. Sad but it does happen between siblings and between parents and children.

Still Jeremy Kyle may be able to sort it out then?