Transfer of equity help - NOW WITH FIGURES

longwalks1

My girlfriend is currently still paying for her marital home with her now ex, 50/50 split. They are planning to sell the house, pay off mortgage and split the remainder and go their sepreate ways. They have defaulted on payments last year during their split and therefore I've read on here she wont be able to get another joint mortgage, with me, because of this. We been talking and wondered if I could basically 'buy out' her ex, (work out what he'd be left with after sale of house, and give him that) and take over half the mortgage (if im in a financial position to do so)

Is it as simple as that, would their current lender let me 'replace' her ex? We been thinking it may be a way of her keeping her name on a mortgage, I'm guessing now they have cleared the debt and are keeping up with payments, the mtg lender will be happy so long as EVERY future payment is met (we may even be able to overpay), is this right?

Is this do-able?

Many thanks in advance

longwalks1

anyone?

maggiecon

Get your girlfriend to ring the mortgage lender and ask them

Give her your details like your credit rating total income etc.

and they will be able to advise you.

wodgerdodger

The technical term Lenders use in your case is a Transfer of Equity and yes it is possible. the Lender would take into account your ability to meet your current commitments plus the total proposed loan allowing for your partners income and her commitments. It will of course depend very much on the payment history of the existing mortgage which you say did go through a bad patch and dependent on how the sums come together they may allow an increase of that loan to pay off ex.
There will be legal costs as you will need to employ a solicitor and there could possibly be an element of stamp duty to pay, your soilictor will advise you.
Normal process is to make application to the Lender via your solicitor i.e get the form from the lender and pass to the Solicitor who will forward to
them as he needs to seek their permission to act on your/their behalf.
Hope this helps

longwalks1

Thanks wodgerdodger

What questions will i need the answers to before I speak to solicitor? So far I've got:

Total mtg owed?

House value?

Mortgage type? (Fixed/variable/tracker etc, i'm guessing with my girlfriends/her ex's bad patch of payments we wont be able to shop around for a better deal once this one comes to an end, and we'll be stuck with the lenders variable?)

Interest rate and period?

Thanks again

longwalks1

forgot to mention the mortgage is with gmac

longwalks1

I've got the figures here now from the mtg company:

Property value: £195k
Mortgage owed: £129.5k (Interest only mtg @ +1.79% above base rate)
2nd mtg owed: £27k

20 years remaining on mtg of £129.5k, 13 years on the £27k.
Transfer of equity fee: £150
Deeds fee: £50

How is it best to work out a sensible offer to put towards her ex to buy out his share? I realise theres lots of figures etc, but any help greatly appreciated

Thanks in advance