Unlocking equity, Will this work?

blackrandomapple

Hello,

Looking for advise please.

I am trying to raise a deposite to buy my first property.
As it stands i have no problems in getting a mortage as i am on a good wage etc, My problem is finding a deposit.
My mum kindly agreed to Re-mortgage her house to unlock some equity for my deposite as her house is in nearly £100,000 equity All seemed easy as pie untill we ran into a problem.

My mums lender said you cannot re-mortgage because your annual income is not enough, For me this was a big kick in the teeth as we have been looking at houses assuming there wouldnt be a problem,

I came up with an idea, but we are unsure if it would work:

Would it give her a better chance of a re-mortgage if she was to put me on the mortgage 50/50, making it safer for them to lend as im on a good wage? This would then unlock my deposit.

If so i could then come back off her mortgage and use the deposite to get my own????

I know this may sound like a long shot but i have been trying to get on the property ladder for ages, I save and save but it seems no matter how much i save i will always need more!!!

Regards

James

CloudCuckooLand

No, it will not work. The lender would need someone to replace you on the 50/50 with your mum...if you have that someone, let them go on it up front...

How much deposit were you trying to get out of Mum's equity. £10k will let you get a £100k house...is Mum's income under £5k? If so, she shouldn't try to fund your deposit, she has little enough safety net in life as it is.

Incyder

blackrandomapple wrote: »

If so i could then come back off her mortgage and use the deposite to get my own????

They may not let her go back to having the whole mortgage under her name. Therefore you may not be able to get yourself off that mortgage unless she sold her house to release you. I know that sound crazy, but it's crazy out there now.

blackrandomapple

Thanks for fast reply.

Ok, Say i stayed on my mums mortgage?

how would this affect my getting my own? I would then have my deposite?

VT82

As has been said, they wouldn't release you from your obligation under your mum's mortgage once you have your further advance and the balance is higher. Then, if you did try and get your own mortgage, they would assume you might become liable for the full payment of your mum's mortgage in the future, before assessing your affordability for any new mortgage you wanted.

How much more deposit were you looking for?

blackrandomapple

Incyder wrote: »

They may not let her go back to having the whole mortgage under her name. Therefore you may not be able to get yourself off that mortgage unless she sold her house to release you. I know that sound crazy, but it's crazy out there now.

Hi,

have a look at my previous post and tell me your thoughts!

Your right it is crazy! All i want is to get started!

blackrandomapple

VT82 wrote: »

As has been said, they wouldn't release you from your obligation under your mum's mortgage once you have your further advance and the balance is higher. Then, if you did try and get your own mortgage, they would assume you might become liable for the full payment of your mum's mortgage in the future, before assessing your affordability for any new mortgage you wanted.

How much more deposit were you looking for?

Im after £26k

My mums house is worth £180k +

She owes £84k

£26k is for a 80% LTV

If i was to go 90% LTV the interest rate is very high, there is a difference of nearly £250pcm.

VT82

Did you ask how much more your mum would actually be able to borrow on her current income? (or was it zero, as technically they wouldn't actually lend her £84k as a new borrower under their current lending criteria?)

iamana1ias

How come you have nothing saved? What's your income?

blackrandomapple

VT82 wrote: »

Did you ask how much more your mum would actually be able to borrow on her current income? (or was it zero, as technically they wouldn't actually lend her £84k as a new borrower under their current lending criteria?)

ZERO.

My mum is self employed. I guess there going on very minimum!

blackrandomapple

VT82 wrote: »

Did you ask how much more your mum would actually be able to borrow on her current income? (or was it zero, as technically they wouldn't actually lend her £84k as a new borrower under their current lending criteria?)

If i was still on the mortgage would this be a problem, It gets complicated now, but im sure this can work. if i was still on the mortgage,

But would i be able to get my own mortgage aswell?