Mortgage advice for 20 year old and Mother

inb4anon

Hello folks,
My Mother and I are currently living in the familly home owned by herself and my father. My parents are divorcing and going their seperate ways. After the divorce proceedings are completed it will leave my mother with around £70k.

As I wish to remain living with my Mother for the short term future, we have discussed the option of applying for a joint mortgage.
Is this kind of thing done? And how likely is the application to be considered?

I would also like to know that if this application is succesful and we do buy a house together, where does it leave me in a few years time when I want to get a mortgage of my own.

Thanks in advance, I look forward to your advice.

:money::money::money:

opinions4u

It can be done. Personally I think you'd be bonkers to consider it.

I would also like to know that if this application is succesful and we do buy a house together, where does it leave me in a few years time when I want to get a mortgage of my own.

The lender might refuse to change the name on the existing mortgage, meaning you can't get a mortgage elsewhere. You may feel that, because the property has increased in value, Mum should buy you out. She might not be able to afford to.

I think the longer term implications make it a poor short term idea.

inb4anon

I appreciate your feedback and I do apologise for my naivety.
It is probably best that I go with my Mum when she see's a mortgage advisor.

inb4anon

Does anyone have any personal experience in this? Or is it that much of a crazy idea.

inb4anon

Sorry for bumping my own post but can someone explain how my Mother and Fathers mortgage being paid out with the sale of the house would be any different from My mother and I doing so in 4 or 5 yesars time.
I did fail to mention that when I decide I want to move on with a mortgage of my own, my Mother will downsize.

JimmyTheWig

I think the suggestion of going with your mum to see the mortgage broker is definitely a good idea.


But back to your original thoughts...

In theory this could all work out quite well.
You'd put your name onto the house and use your income to help secure the mortgage. Then you both sell up in, say, 5 years time both collect a nice tidy profit because the value of the house has gone up, you'd have a deposit to put down on a place of your own and your mum could downsize appropriately.
If you'd have done this in the late 1990s/early 2000s then this is what would have happened.

But this is not what is happening.
Prices are not currently going through the roof. They are pretty much standing still.
Houses are not being sold as soon as they go on the market. They are taking months, at best, to get a buyer.

I used to say that I wouldn't buy a place if I couldn't see myself staying there for 5 years. This would be enough time to ride out any dips in house prices and for the general long-term house price inflation to beat the associated fees.
These days I would make that 10 years.

In your case, OP, you can't really guarantee staying there for 3 years. It is quite possible that you may meet someone and want to start a family. In my case, for example, there is no way I could have predicted that 3 years before our first baby was born. But it happened nonetheless.

Like I said above, 10 or 15 years ago, staying in a property for 3 years wouldn't have been a problem. Now it may well be.
What may quite well be the case in 3 years time if you go ahead is this...

* You want to move out, so your mum agrees to downsize.
* The housing market is pretty slow and it takes a long time before you get offers for the house. After this wait you may well want to take the first offer that comes in and/or drop the price significantly to get the offers.
* House prices in general have fallen.
* You've already paid out various costs (solicitors, mortgage) to get the whole process going.

So you've paid out all that money to end up having to sell a house that is worth less than it is worth now.
I don't know how much equity your mum has in the house right now. I don't know to what extent that she is happy to use that to bail you out if prices go down. But you may find yourself in a position where you can't afford to move.

Think about the resentment that that will cause all round.


All of that said, I think that there are scenarios where it might be worthwhile considering.
For example if your mum only has a few years to go until she is mortgage free.

I think you need to consider your other options.
If your mum can get the mortgage on her own then this would seem to be the best plan. If not, it may be best to sell and rent.

rising_from_the_ashes

Can your mum afford to stay in the house without you getting a joint mortgage with her?

If so, paying her rent instead and saving money for a deposit may be the best option - as others have said, say you may want to move out to your own place at some point and if you can't sell the house .....

DVardysShadow

inb4anon wrote: »

Sorry for bumping my own post but can someone explain how my Mother and Fathers mortgage being paid out with the sale of the house would be any different from My mother and I doing so in 4 or 5 yesars time.
I did fail to mention that when I decide I want to move on with a mortgage of my own, my Mother will downsize.

The problem is that in 4 or 5 years time, when you want to move on, your mother may not be able to continue the mortgage on her own. So you are in the horid position of having your mother thrown out of her home for you to move on. Don't do it. The best advice is for your mother to buy on her own and for you to support her with rent - which if she has any sens she will put to overpaying the mortgage.

Thrugelmir

inb4anon wrote: »

I did fail to mention that when I decide I want to move on with a mortgage of my own, my Mother will downsize.

More sense for your mother to buy somewhere she can afford and settle.
You could then assist by paying the bills. Until such time as you wish to move on.

Little point in short term speculation for a potential gain. The costs to your mother of selling and buying again will be significant.