Advice for buying a new home

FireWyrm

Hello All

Ive been a lurker here for some time. I have a question which perhaps some of you might have a good answer for.

I am in the process of buying a home. I am a young woman who is earning a decent wage and I have been able to secure a mortgage to buy the house I am interested in. I am also married to a man who has absolutely no financial sense what-so-ever and the absolute worst credit rating possible.

During the course of the legal process, my solicitor is asking me whether I want to add my husbands' name to the house deeds and something to do with Tenancy which I dont understand. I have two small children and if I were to fall under a bus tomorrow, I would like to protect their interests. Being realistic however, my husband would never be able to afford the mortgage on the property let alone convince the bank to allow him to take over, so they would be forced into foreclosure I'm guessing. As it stands, I can shoulder the mortgage alone and all of it's financial implications, I have already begun proceedings to have life insurance etc on it, but what I dont know, is whether to include my husband in the deeds. What do the solicitors questions mean and what is the best way to secure all their futures without having his terrible financial record taint the sale?

Thanks in advance.

FireWyrm

hcb42

Firstly you should take out life assurance for the worse case scenario. That way if something happens to you, your hubby will at least have the mortgage paid and there won't be foreclosure.

Houses can be owned as either Joint Tenants, or Tenants in Common. The difference is on what happens in the event of death - i.e. you either both co-own the house, or you each own 50% and can do what you like with it after death. Most marriages assume a Joint Tenancy, although this is obviously not exclusive.

I would think therefore that based on what you say, you would want Joint Tenancy, although under inheritance law, he would inherit the first £xxxK of your estate in any event , if you died without a will (I think it is £325K but dont quote me on that as I haven't looked it up recently)

CloudCuckooLand

As you need a mortgage, its not just down to you whether he can go on the deeds...

The lender may well decline to provide a mortgage, or provide it on worse terms, for including your husband on the mortgage, in order that they will allow his name on the deeds.

Usually a married person not included against a mortgage is required to declare no interest in the property - your solicitor should know this. The lender requires them to do that, otherwise they have to consider that person jointly liable, and cannot repossess should they need to. With awful credit I doubt they would give a mortgage jointly, so must have the declaration, so he cannot go on the deeds...catch-22...

Make the life insurance pay out to clear the mortgage, and therefore bequeath the house to the children, or into trust if their ages require it, upon your death..? Your solicitor needs consulting in more detail. Is it a real solicitor, or a conveyancer..? You need the former.

FireWyrm

Thank you CloudCuckooLand. That was most definitely what I was afraid of. I'm in a catch 22 and I don't know what to do for the best. I was half thinking that a life insurance policy combined with a will would cover it, but we all know that it's a toss up whether insurance will pay out since they seem to do everything possible to weasel out of it. I don't know why type to go for to be honest. I don't want to prejudice his claim to the property, but on the other hand, Halifax are unlikely to accept him as a debtor given his terrible history. For the record, he can't even get a bank account.

My biggest concern is to protect our children in the case of my death since they would be terribly traumatised and a foreclosure would be the worst thing that could happen. He's big enough to take care of himself, but our house would be our biggest asset and must be protected at all cost.

The solicitor is a conveyancer and doesn't seem to know too much about this and neither do I. I was told that as a married couple he would automatically inherit my 'half' but I want to guarantee this in law. On the other hand, should Halifax find out about his history, they could yank the mortgage out from underneath us.

Another worry is also niggling. Life isn't perfect and sometimes it is necessary to divorce. I don't believe that this would happen in our case but then, neither did my parents when they first married. We've been together for 16 years now and I would be a fool to ignore the possibility having had first hand experience of just how nasty it can get. What happens in this case? To my mind, if I am living in the home I bought and paid for, then he has no claim to it, especially if I have the children? On the other hand, my sense of justice says that he does. How do I deal with this and mitigate any problems in the future?

CLAPTON

you need simple life insurance
i.e. that pays out if you die and so can clear the mortgage; it's cheap and it's simple as death is fairly easy to identify and so has no real catches like many other types of insurance.

given his poor credit history it is probably better for you to have the mortgage and the house in your sole name. this would also make a divorce easier

you need to read up about inheritance and what happens if you die and then make a will after careful consideration