Mortgage refusal

holly_hobby

Ok - so there is absolutely no way Dad will gift the capital without reservation - so your options have to be him being party to the deeds and/or mge.

DVS makes a good suggestion of BTL - and holding the property as tenants in common - as this will also help with the max age restrictios on normal residential mortgages. But it means no SDLT relief on purchase, as the property is not being purchased as the main residence of either party, and Dad will be both party to the mge and deeds - which I know is what he originally wanted to avoid. Rates are also higher than residential mortgages - but is an option.

If you want to go the BTL route, most lenders have a minimum earned salary of 25k, apart from Ipswich B Society and The Mortgage Works, which will possibly fit if Daughter does not have this income.

Ipswich BS accept direct business without geographical restriction, and also don't have a max age under BTL, which should solve Dads age issue.

Their minimum loan for buy to let is £50,000 with 125% rental cover required on new application (which will be assesed by the surveyor as part of the general valuation process), and they require the letting to be managed under an AST. (of course at completion there be no tenant, so your Daughter could move into the property in the meantime , although usually I wouldn't propose this it is a way around the tenancy & BTL regulation issue re family member lets).

Dad needs to be aware that in all cases, all parties to the mortgage are jointly and severally liable for its repayment - so all parties are responsible for maintaining the mortgage regardless. (whether he would be willing to accept this legal responsibility is an issue for discussion between the family).

If BTL isn't the route for you, the only other way for Dad to avoid legal responsibility & protect capital under the property, is to seek a lender that allows parties to the deeds, whom are not noted as mortgagors (of course your Daughers income & status would need to be sufficient to service the reqd mortgage), the lenders whom I believe consider this arrangement are Barlcays and HSBC.

Other than this, I am at a loss in how we can solve the issue that your Hubby does not want to be on the mge or noted on the deeds to the property, but refuses to gift the capital without reservation to your Daughter (one assumes because he has reservations as to its voluntary return) ....

Further issues re his party to the property may be in connection with any application to state funded long term care - so professional advice on the disbursement of equity under the tenants in common deed needs to be sought, in addition to CGT protection achieved by the same method.

I do hope you find a solution if none of the above fits ... as there are no other solutions that I can think of ... others may be able to pull something out the hat for you ....

H