purchasing interest in property

dudemyster

hi, i am looking for some advice ...iam currently going through a divorce. we have a house which is in both are names. she has said that she would consider letting me purchase her interest in the property before my youngest daughter is 18 (2 years time) there is about 40k equity in the property ergo 20k purchase .

should i got to the current lender and re mortgage? would a new lender consider the loan? also my parents are mortgage free and sitting on a a 250k property should i consider a a mortgage using that as security or equity release (with permission lol)

or any other suggestions??

thx in adv

chris

holly_hobby

You are looking for whats called a "transfer of equity", and it sounds like a release of equity to "buy her out".

With your current lender, it will be a further advance - subject to your income be sufficient to service the existing (& further borrowings).

If you are on a mortgage product with your lender, the main advance will remain on that and any further borrowings may be on standard variable (SVR) or they may offer you access to a product i.e tracker or fixed rate.

There may be a survey reqd dependant on when you pch the property, its current estimated value and the overall total borrowings reqd.

If you want to move lender, this will be a remortgage, it stil involves a transfer of equity (as you are going from a joint mge to a single name mortgage)

Again your income must be sufficient to support the requested borrowings, and you must meet the lenders other lending criteria including the valuation of the property.

You will be able to effect the whole borrowings on your chosen morgage product i.e tracker or fixed (or svr if you prefer !)

You are unable to use another property owned by another individual to support any mge borrowings of your own - so your parents home as security is a no go.

They could release equity from their property to assist in your buying your partner out (subject to criteria and status/income checks). Although to obtain a mge their ages may muddy the waters with regards to how long they have to retirement, and whether their income in retirement would support the requested lending (which on an unencumbered (mge free) property is a min loan of 25k). Even though you may be paying the mge on their property for them, the affordability will be based on themselves as it is their property and thereby the mge (and resulting liability) must also be in their names.

Hope this helps

Holly