Mum is buying new house... do I buy the current house from her?

k18dan

Hi.... I am a complete novis to house buying ect....

My situation is this... my mum has decided to buy a new house with her partner... and sell the 2 bed property we have been leaving in for 10+ years.. I would dealy love to get on the property ladder as quickly as possible... however I planned to move into the new house with my mum and her new partner.

I could buy the property from my mum?

What would people do.. any good ideas?

Sapphire

You could buy the property from your mother. However, you need to work out your finances carefully - how much the property would cost, what you can afford to pay a lender each month, given your current salary, etc. Without knowing the details of your earnings, any savings you might have and the cost of the property, it is difficult to give you more specific advice.

k18dan

The property is worth about 170K.... my earnings are around 17K a year (I guess a full lend will be impossibble) savings are around 10k in ISA, what are my other options?

I did think about renting my mums property?

lilyann1

You'd get a good deal and your Mum would avoid EA fees if she sold privately to you.
You need to speak to a mortgage broker to see how much you can borrow and then go from there.

divadee

i dont think you would be able to buy the house on your own at that price and your earnings.

its almost 10 times your salary!!!!

lilyann1

Can you buy this house with somebody else? How anybody gets on the property ladder these days I do not know?
Or perhaps your Mum can help you out with finances?

RHemmings

lilyann1 wrote:

You'd get a good deal and your Mum would avoid EA fees if she sold privately to you.
You need to speak to a mortgage broker to see how much you can borrow and then go from there.

If she's to pay £170,000 for the house, with a deposit of £10,000, then that's a mortgage of £160,000. That's 9.4 times her salary. Assuming that she can get such a miortgage, if the interest rate is 5%, she would be paying out £666.66 a month in interest. That's £8000 per year, or almost half her gross salary.

Unless mumsie is prepared to sell her the house at a huge discount from the value, then perhaps something could be done. But £170,000 just seems way out of reach.

k18dan

Do you think it would work if my mum was to carry on paying the mortgage, and I was to give her the money... so may be I could get a contrach made up saying "at this date I payed this much money per mother and the equity from this date would be mine" ??

I spoke to my mum and she said she had be thinking about passing some of her equity from the house on to me anyway as a inheritance... so maybe I could as for a good price on the house.. lol

If I was to rent the house out would I have to have a buy to rent mortgage???

RHemmings

k18dan wrote:

Do you think it would work if my mum was to carry on paying the mortgage, and I was to give her the money... so may be I could get a contrach made up saying "at this date I payed this much money per mother and the equity from this date would be mine" ??

I spoke to my mum and she said she had be thinking about passing some of her equity from the house on to me anyway as a inheritance... so maybe I could as for a good price on the house.. lol

If I was to rent the house out would I have to have a buy to rent mortgage???

How much money per month would you be giving your mother? How much of this would be paying off the house? There are an infinite number of ways that you could buy the house off your mother, but I can't see how you could buy the house on your salary unless your mother sells you the house for much less than £170,000, or effectively loans you the money without charging interest.

lilyann1

As said before your Mum might give you a good price and a huge discount.
I think you need to sit down with your Mum and discuss things and money and maybe get the advice of a solicitor re drawing up that sort of contract re the equity.

k18dan

Thanks for all the advice... We are going to have a sit down and chat about what we are going to do... update you soon :beer: