Removing name from joint mortgage

iazcac

In Jan 2008, I bought a house with my brother for £129,950 on a 100% mortgage with C&G. It is now on a SVR mortgage @ 2.5%

The outstanding value of the mortgage is now c: £125,000, and the property is worth around £120,000.

We now want to transfer the property into my brothers name only. What are my options to get myself removed from the mortgage and transfer it all into my brothers name? He is able to afford paying 100% of the mortgage repayments.

Thanks in advance.

somethingcorporate

You need to talk to the mortgage company. You don't just "release" a name from an existing mortgage it is likely it will need to be refinanced and hence depends on your brothers financial background, creditworthiness, deposit etc. It has very little to do whether he can meet the current repayments.

withabix

You might well be stuck until there is some equity in the property, or you can pay off a lump sum to get below 95% (probably).

Thrugelmir

Would appear that your mortgage is on an interest only basis. Suggest that either you switch this to a repayment basis or start making overpayments. Without some equity in the property your brother will struggle to find a mortgage product at such a high LTV.

carlw

Thrugelmir wrote: »

Would appear that your mortgage is on an interest only basis. Suggest that either you switch this to a repayment basis or start making overpayments. Without some equity in the property your brother will struggle to find a mortgage product at such a high LTV.

Have i missed somthing from the post, how did you come to the conclusion that they are on an interest only mortgage. If they had a 100% mortgage and now owe less than they paid for the property, they MUST be on a repayment mortgage surely?

Thrugelmir

carlw wrote: »

Have i missed somthing from the post, how did you come to the conclusion that they are on an interest only mortgage. If they had a 100% mortgage and now owe less than they paid for the property, they MUST be on a repayment mortgage surely?

House bought in Jan 2008 for £130k. Four years later mortgage is still £125k. So that's barely capital repaid of some £104 a month. Even on a 35 year mortgage term the amount owing would be less on a repayment basis.

iazcac

Yes, it is a repayment mortgage over 35 years (31 remaining).

kingstreet

Approach your lender. Your brother will be vetted against current criteria to see if he would qualify for the mortgage alone - ie does he have the income/status to justify that level of borrowing?

The negative equity may not help as the lender may view releasing you as a bad idea taking away one of the potential payers in the event of repossession.

If approved, a transfer of equity will then be required involving a solicitor. Total cost for lender and solicitor around £400 to £600.