Mortgage Issues

mediad

Hi, i am currently trying to sort out my parents mortgage which they have had for the last 7 years. I have recently found out that the mortgage is on an interest only mortgage and because of my dads age their is only 6 years left on his mortgage. At present he has a remaining balance of £117k and due to not having many savings or shares it will be quite difficult to pay this off at the end of the term.

I am looking to find out if there is anyway i can add my name in order to increase the term and to change this to a repayment only method. Obviously if i was to purchase the property then would i have to purchase this at the current value rather than his remaining balance? If somebody could please advise would really appreciate it.

Thnx in advance.

Thrugelmir

Start making overpayments immediately on the mortgage.

How old are your parents?

mediad

Thrugelmir, thanks for your response. Yeh gona be doing that but was a bit difficult as mortgage has just dropped from an interest rate of 6.8 to 2.8 so thankfully payments have dropped from 700 to 300 so will now be able to make extra payments.

My parents are both 59 so i dont know if extending the term is an option...

Thrugelmir

mediad wrote: »

Thrugelmir, thanks for your response. Yeh gona be doing that but was a bit difficult as mortgage has just dropped from an interest rate of 6.8 to 2.8 so thankfully payments have dropped from 700 to 300 so will now be able to make extra payments.

My parents are both 59 so i dont know if extending the term is an option...

Well 6 years at £400 a month is around £29,000 (excluding interest savings) so a step in the right direction.

May be worth running through their budget to see what else could be cut out.

Age is a limiting factor. Will your parents have a reasonable income in retirement, i.e. private pensions?

mediad

thrugelmir, wont really have any private pensions as my dad was self employed but been out of work due to being ill for the last couple of years so things are really tight.

Is there anyway i can get the mortgage on my name or something and then change this to a repayment?

handytips

Your parents could gift you the equity remaining in the property and you could use this as the deposit. Talk to Santander this they will do either on repayment or pure interest only, however you would have to do this in your own name assuming your income stacks up. Good Luck

Meeper

Depending on the values, gifting equity can lead to a stamp duty liability. Care required here.

mediad

So buying the property off my parents would be an option... hmmm. thnx guys...