Can anyone help??

sappersmum

My son agreed to be on my other sons mortgage as he split up from his partner and would have to loose the house because although he can afford it on paper the figures didnt stack up. My 2nd son who then helped wants off his mortgage as he wants to buy a house with his fiancee and although doesnt pay a penny towards the house the mortgage people say no - what is the best way to go about it - the house is in negative equity so selling isnt an option.......please help anyone thanks sappersmum x:(:(:(

Jenniefour

Selling would be an option if your sons are willing to pay the shortfall to redeem the mortgage. It would free them up to start again. Other than that there won't be another solution until one or either of them earns considerably more than they do now, so that it's possible for your son who lives in the house to take on the mortgage himself - or for the other one to be able to get another mortgage anyway. Unless someone else in the family is willing and able to put a big lump of cash into this to make it work. Or is the house big enough for them all to live there together?

Someone else might have some better ideas.

Thrugelmir

Only realistic option is to wait until the negative equity is cleared. As if no1 son defaults for any reason then no2 is liable for the debt.

Adding oneself to a mortgage may have seemed a good idea in the boom times. Now the situation is totally different.

To clear the negative equity then renting a room to a lodger to gain extra income is worth considering.

Jenniefour

And just to add a bit Thrugelmir's suggestion - overpay mortgage anyway, if possible.

sappersmum

The problem is that there is about 28k negative equity in the house - son number 2 doesnt pay a penny towards it just used his name to get the mortgage from going under when son 1 had split up.....

Would son no 2 be able to get another mortgage if he proved it was just his name or would they take it as his debt too???

So worried about both of them now - thanks for taking the time to answer.

hcb42

it's hisdebt too, he is now equally liable

Thrugelmir

sappersmum wrote: »

The problem is that there is about 28k negative equity in the house - son number 2 doesnt pay a penny towards it just used his name to get the mortgage from going under when son 1 had split up.....

So easy with hindsight to point out the downside. As that's exactly the situation that they find themselves in. As isn't just a question of being a "name". Son no 2 has signed a legal contract to repay the money owed. Now that his own situation has changed he is unable just to walk from the undertaking.

The negative equity has to be addressed first. Eventually the market will recover and prices will rise. Though this may take years. In the meantime son no 1 overpaying the mortgage would be an initial step.

powerwin

sappersmum wrote: »

Would son no 2 be able to get another mortgage if he proved it was just his name or would they take it as his debt too???

Legally it is his debt, so it will be taken into account when assessing No 2's suitability for a new mortgage.

No 2 may not be able to get off the mortgage until a change in circumstances for No 1, e.g. No 1 earns more, or perhaps gets a new partner etc etc.

Rgds

neverdespairgirl

sappersmum wrote: »

Would son no 2 be able to get another mortgage if he proved it was just his name or would they take it as his debt too???

It's not just his name - it is his debt!

kingstreet

I recently had a similar situation.

My applicant was party to a mortgage with three of his friends and the property was in negative equity. He wanted to buy with his partner.

We had a 20% deposit and approached Nottingham Building Society who agreed to take the payments for the current mortgage off the applicant's income like a credit agreement, so they assumed he might be responsible for the full payment if his friends defaulted. The residual income was sufficient to provide good affordability for the new mortgage, so the case proceeded without further problem.

Your second son was ill-advised in taking the action he did. He is jointly and severally responsible for the whole debt if his brother is unable to make the payments.