Mortgage not secured on house

daniel_3-2

Hi,

Quick question I can't seem to get an answer to and maybe I am being a little stupid here but anyway....

My partner and I have decided to buy a house. She will put in 600K cash and I will have to unfortunately mortgage to put my part in. I want a small mortgage so 100K is fine. So, we have 700K as an amount with my partner owning outright six sevenths and the bank owning my seventh...

How will this work for a lender? Can I get a mortgage based upon my proportion of the house? Would a bank lend to me based upon this scenario? If not is there a specialist loan or mortgage I could take out?

Thank you all in advance....

maninthestreet

daniel wrote: »

Hi,

Quick question I can't seem to get an answer to and maybe I am being a little stupid here but anyway....

My partner and I have decided to buy a house. She will put in 600K cash and I will have to unfortunately mortgage to put my part in. I want a small mortgage so 100K is fine. So, we have 700K as an amount with my partner owning outright six sevenths and the bank owning my seventh...

How will this work for a lender? Can I get a mortgage based upon my proportion of the house? Would a bank lend to me based upon this scenario? If not is there a specialist loan or mortgage I could take out?

Thank you all in advance....

Probably not - how will they repossess 1/7th of the property if you default on your mortgage payments? Both you and your partner will have to apply for a joint mortgage on the property, with a 600K deposit.

daniel_3-2

This is what I was thinking with regards to the bank repossessing the property. So the mortgage will have to be in joint names but is there a way to proportion the mortgage so that IF the mortgage was not paid then my wife gets six sevenths of the value if you see what I mean.
Cheers

beecher2

Have a word with your solicitor as you can draw up a document which states the split - think it is called a deed of trust but someone else will correct me if I'm wrong.

shortchanged_2

daniel wrote: »

Hi,

My partner and I have decided to buy a house. She will put in 600K cash

Your partner doesn't happen to have an equally wealthy single sister by any chance?

maninthestreet

shortchanged wrote: »

Your partner doesn't happen to have an equally wealthy single sister by any chance?

...who is, hopefully, a brewery heiress and has loose morals???

Senior_Paper_Monitor

Deed of Trust + house owned as Tenants in Common (86 / 14 split) - any conveyancing solicitor will be able to handle with the purchase process.

Your partner will still be liable for 'all the mortgage', as will you, under the 'joint and several' responsibility under the mortage agreement.

daniel_3-2

Thanks everyone for the replies. The Deed is a great idea but is there any way to keep my partners name off the mortgage at all. My partner is (understandably) nervous about her name on a mortgage when she is far and away the largest contributor to the house. Maybe a loan would give me the 100K i need?

Senior_Paper_Monitor

No, sorry, won't happen if a mortgage is used.

If you can fund, secure (not on the house) and use a loan from another source no problem (other than probably considerably more expensive)

TrickyDicky

daniel wrote: »

Thanks everyone for the replies. The Deed is a great idea but is there any way to keep my partners name off the mortgage at all. My partner is (understandably) nervous about her name on a mortgage when she is far and away the largest contributor to the house. Maybe a loan would give me the 100K i need?

She still owns 6/7ths of the house with the deed. If the mortgage was unpaid, the mortgage company would reposess, sell the property and give your partner 6/7th of what ever it sells for, with you getting the other 1/7th.

daniel_3-2

OK, much clearer. So, if a doomsday scenario was to happen and the house repossessed do they sell at market rates or lower to get their money quicker? I assume we will both be blacklisted if we default on a mortgage...