Mortgage for share of property

kirstgard

My mother and cousin have inherited a property. My mother is keen to sell her share, but my cousin wants to hold on to her share as an investment. There is no mortgage on the property.

I am interested in buying my mothers share and living in the property.

My cousin is happy with this and does not want to live in the property herself. I would probably pay her minimal rent for her share though.

I have spoken to a mortgage advisor who says that I cannot get a mortgage for a 50% share of the property - I would have to buy 100% of the property, or my cousin would have to be on the mortgage also. Is this correct? Do I have any other options?

VIGILANT22

your mortgage adviser is correct...is this a surprise???!!

_Andy_

Why ask a professional for advice and then disbelieve them, then ask random members of the public on a web forum for advice?

Wutang_2

kirstgard wrote: »

Do I have any other options?

Billions....

sillystudent_2

Umm well I'm not sure how helpful this is (you've probably explored this already ) but do you own a property atm/have any equity in it? If so, could you not just re-mortgage your current house to buy out your mother, then pay off that with a mortgage from the house (since you now 100% own it )
Of course this depends on how much the house is worth, any idea?

Failing that, the best option would be (though this requires quite a bit of trust!) to get your mother to sign over her half of the property in exchange for you signing a legal agreement that you owe her x amount and will get a mortgage for that amount on the property as soon as it's yours. I guess you'd have to pay a solicitor to draw up the contract but it'd be a small price to pay

phlash

Hang on. Are we sure the advisor is correct?

If you own the house as "tenants in common", is there not the opportunity to get a "fractional mortgage"? Where you can mortgage your portion of the property, and effectively only put at risk your portion of the house, in this case the lender lends on 50% of the house.

See http://www.easier.com/58830-uk-building-society-lends-on-fractional-property-purchases.html

Whether you can find the lender is the key question!

VIGILANT22

phlash wrote: »

Hang on. Are we sure the advisor is correct?

If you own the house as "tenants in common", is there not the opportunity to get a "fractional mortgage"? Where you can mortgage your portion of the property, and effectively only put at risk your portion of the house, in this case the lender lends on 50% of the house.

See http://www.easier.com/58830-uk-building-society-lends-on-fractional-property-purchases.html

Whether you can find the lender is the key question!

http://www.easier.com/58830-uk-building-society-lends-on-fractional-property-purchases.html

Quote "These new mortgage options are the first of their kind in the overseas investment market.

phlash

You wouldn't be able to find the lender then!

Debt_Free_Dreamer

This does not sound like a good idea. (Sorry to be a downer...)

What happens when the cousin wants to sell and wants you out.
What happens if the cousin dies and the person who inherits the property wants to sell and wants you out
What happens when the house needs repairs? Who pays?
Who gains on the investment if you have paid for improvements?
What happens if there is ever a family dispute, you could lose your home.

If you cannot get a mortgage for a whole house, look at a % share with a housing association. My first home was like this and worked out very well.