buying house and swapping it with sis in law

doncouple

my sister in law wants to buy my house to get on the property ladder but cannot afford the deposit, so we came up with a plan to get her this house and us a bigger one
so ere it is . at the moment i have a mortage for 40 grand but the house is worth about 110 grand, so i was going to remortgage my house and get a 40 grand increase , then give the 40grand to the sister to go to the bank and use the money as a deposit to buy the house we want to move into and then after it is all sorted swap houses , she ends up with my house and 100 grand mortgage and we end up with a 140 grand house with a 80 grand mortgage ..

i want to know if this is all possible or well we get done by anyone for it

timmyt

too muddled, try and explain again

doncouple

can i give to her 40grand to buy a house then swap it with me

timmyt

swap, as in transfer ownership or just live in each other's?

doncouple

transfer ownership

timmyt

you cannot gift your house subject to your mortgage without your lender's consent, and they would be daft to agree for all sorts of reasons

your sister would need to disclose to her lender that your are giving her the deposit on hers and the lender may not agree to lend to her, and she would also need lender consent to gift her house to you

you want the house she is thinking of buying, so why not sell yours to your sister, and she takes a mortgage on yours, and you buy the bigger one and get your own mortgage on that

mark5

You re-mortgage your 110k house from a 40k mortgage to 80 k mortgage.

You give your sister in law the 40k to use as a deposit to buy the house you want with a 100k mortgage.

Then you swap houses?

If you then swap houses your sister in law will still owe you 10k from what I can work out not to mention you both pay 2 sets of legal fees on each side along with possible redemption charges on the mortgages.

doncouple

but she cannot raise the desposit and i can only get it for her by lending of my house now , do you have any way round it

G_M

You cannot sell, swop, or transfer ownership of a property if there is a mortgage on it without the lender's permission.

[Deleted User]

Hi,

this 40k, that you are going to give her, do you get it back, how is she going to repay you on top of a mortgage, or is it just a gift?

Doozergirl

You don't want to give her £40k though, you want to give her £10k?

You just need to sell her the house for £110k and gift her £10k deposit. But whether £10k is enough of a deposit for her to get a mortgage, I don't know. It's high on LTV, the deposit is a gift from someone else (in theory a vendor gifted deposit which lenders don't like - whether you can get around that being related I don't know) and will her salary multiples allow a mortgage for £100k?

You then take the £60k change as the deposit for a new house and port your current mortgage to the new house, or get a new one. You can do it all at the same time, as if you're in a chain.

But you can't just transfer houses and mortgages around. Remortgaging in your own name is pointless when you're actually selling it. If the house is going in her name, it has to be her name on the mortgage (a new mortgage) and she can still only borrow as much as the bank will lend her.