Remove name from mortgage but not title deeds

coupe20vt

Hi,

Long time lurker first time poster! I'll start by saying I have tried a search to answer my question, but have had no luck. My wife is on the mortgage and title deeds with her parents, at her parents house. My wife & I want to buy a house together and we need to remove her name from the mortgage on her parents.

Is it possible to remove her name from the mortgage on her parents house but have her name remain on the title deeds for that same property?

Any help or advice is greatly appreciated.

Coded

Hi coupe

Uusally you cannot have your name on the title to the property if your name is not on the mortgage, however it all depends on the mortgage company. Most situations I have come across do not allow it however I have had one situation where HSBC have allowed this to happen but the best thing for you to do is to speak with the mortgage company and see what they say.

holly_hobby

Firstly, and notwithstanding the deeds issue, to have your wife removed from the current mge liability with her parents - her parents income and status must be sufficient to service the mortgage with the current lender on their own, in order for the lender to agree to the release of your wife.

Putting the income & parents issue to one side - her remaining on the deeds, yet having no legal liablity for mge repayment will be a major issue with most lenders, they only one I have heard whom are happy to consider such a situation, are Barclays, would be a happy coincidence if these were your wifes current mortgagee. (sorry I can't comment on HSBC as per above posters comments).

Hope this helps

Holly

coupe20vt

Thanks for the advice. We'll start by speaking to the lender.

Thrugelmir

Why does she need to remain on the title deeds?

coupe20vt

She has paid £13,000 into the mortgage. While her parents are able to continue paying the mortgage without her wage (and have done for the last 3 years) they don't have the savings to buy her out. As a compromise I was hoping we could remove her from the mortgage so we were able to get one ourselves. If we coulld keep her name on the deeds she has a legal right to the equity in the property, therefre looking after the money she has paid into it.

Thrugelmir

Her parents could gift that amount in their wills as a bequest.

holly_hobby

The only problem would be in bequesting the equity is that if may be subject to IHT (dependant on value of net estate) on the parents death (unless noted & legally drawn up as a loan between parent and child repayable on death, and therefore considered a liability against the estate).

Another problem could be, is that your in- laws may secure a further loan against the property (subject to status & with the mortagees permission), without the knowledge of your wife.

Or sell the property without returning any capital to your wife.

Or the property be considered as part of any application to state funded long term care requriement.

If she comes off the deeds, you will need to consult a solicitor as to how the above may be protected against, and in having a legal drafted agreement drawn up, as to how equity will be apported on disposal of the property, be it on death or sale.

Holly