Is Joint Equity Being Squeezed Out ?

GeorgeHowell

We want to help a younger family member put together sufficient deposit to buy a property. Joint equity (tenants in common based on percentages owned) seemed the best way. A proper trust deed etc would be drawn up by a solicitor.

However, in investigating mortgage options via a broker, the family member finds that lenders will not grant a mortgage that extends beyond the 75th birthday of anyone on the mortgage. This apparently applies even if amount of the loan can be fully supported by the income of the younger relative only. It results in unacceptably low mortgage periods, and subsequent unacceptably high monthly repayments.

As far as we know, in order to have joint equity it is necessary for everyone named on the title deeds to also be included in the mortgage. This is because lenders will not risk the hassle and delay of repossessing the 'non-mortgaged' part of the property if it came to it. This appears to mean that if older people want to help younger relatives in this way, the monthly mortgage payments are unaffordable for most people. Joint equity of this type appears to be being squeezed out of the realistic options.

Does anyone have any experience or knowledge of, or insight into this problem ?

Thrugelmir

Take a look at the Lloyds Lend A Hand Scheme.

dimbo61

You could also look at YBS family and friends offset mortgages

Joint_Equity

Have a look at the web site of Joint Equity Ltd (Google shared home ownership we are listed number 3 ) where you can access a co-ownership scheme that already does what you need.

Unfortunately most mortgage lenders today are not really in the business of helping anyone, they are more interested in cherry picking the low risk borrower as they see it.

Joint Equity is an alternative to renting and helps people to buy their own home.