Complex Mortgage Problem?

Thrugelmir

Why not sell your existing property to your inlaws, which they could then rent out.

In exchange buy the new property in its entirety from your inlaws.

Find a lender offering a family offset mortgage facility. Your inlaws could then deposit money which would offset the mortgage interest and repay the capital balance as well in a tax efficent manner.

To enable them to remain in the property. Could they not be given an option to repurchase the property at the original price should for any reason you decide to sell it. Seeing as they are contributing to the mortgage, you would be gaining financially although wouldn't benefit from capital growth.

motorguy

VIGILANT22 wrote: »

and you're point is?

sorry, i thought your point was relating to a situation whereby either parent ended up in a home - that was what the document seemed to be about?

Perhaps you could clarify what you meant?

motorguy

CloudCuckooLand wrote: »

If you cannot convert your current residential mortgage to BTL, you may have trouble having sufficient income to support two mortgages.

We're applying to the current mortgage company to allow us to rent it out due to not being able to sell it. They seem fine with that.

motorguy

Thrugelmir wrote: »

Why not sell your existing property to your inlaws, which they could then rent out.

In exchange buy the new property in its entirety from your inlaws.

Find a lender offering a family offset mortgage facility. Your inlaws could then deposit money which would offset the mortgage interest and repay the capital balance as well in a tax efficent manner.

To enable them to remain in the property. Could they not be given an option to repurchase the property at the original price should for any reason you decide to sell it. Seeing as they are contributing to the mortgage, you would be gaining financially although wouldn't benefit from capital growth.

That would work in that it would protect their current 'loan' to us of £175K - i dont think though that the FIL has an issue with lending us the remaining £175K for a year or two. (though i would imagine the solicitor will pick up on the fact that they should, so that might be a way round that aspect.

motorguy

Is there any way of protecting the wifes parents right to live in the house without using a 'life interest' mechanism, which from my limited understanding would be offputting for the mortgage company, as it seems to carry over beyond say, any repossession?

I have no issues with making a legal commitment to that, but we obviously cant do so at the expense of not being able to get a mortgage on it.

sammyjammy

Just remember that solicitors are there to advise you, they cannot insist on you doing something unless it would be unlawful not to.

Thrugelmir

pgilc1 wrote: »

Is there any way of protecting the wifes parents right to live in the house without using a 'life interest' mechanism, which from my limited understanding would be offputting for the mortgage company, as it seems to carry over beyond say, any repossession?

I have no issues with making a legal commitment to that, but we obviously cant do so at the expense of not being able to get a mortgage on it.

Simply put, no.

The issue to the mortgage company is the value of the property whilst a " life tenant" is residing in it. As it will devalue the property value.

motorguy

sammyjammy wrote: »

Just remember that solicitors are there to advise you, they cannot insist on you doing something unless it would be unlawful not to.

That would leave my wifes parents interests unprotected though, and therein lies the problem for us.

VIGILANT22

pgilc1

For you to be scrabling around on an internet forum instead of taking professional advice says it all............

motorguy

VIGILANT22 wrote: »

and you're point is?

VIGILANT22 wrote: »

pgilc1

For you to be scrabling around on an internet forum instead of taking professional advice says it all............

Have i done something on you or are you always ignorant to people?

I'm not 'scrabbling around on an internet forum', i'm asking for advice before we all sit down (again) with our solicitor. I have met with him 3 times so far on this and my wifes parents have met with him twice. this is a scenario that he hasnt seen before or dealt with, and i would like to be able to go into that meeting with some suggestions, based on what people on here are saying as some possible avenues to find a solution to this, that may trigger some thoughts with him - rather than get into a scenario whereby we lose the mortgage offer.

The last thing i / we / all of us want is a scenarios whereby my wifes parents - given they are in their 70's - dont feel secure in their twilight years. We want to put in place an agreement that meets that, allows us to feel secure, and also will be accepted by the mortgage company.

I dont think its unreasonable for me to be asking the opinion of the greater knowledge on here. Can you explain to me why you do?