Changing a mortgage to wifes name

firsttimer1986

Hello All,

I havent managed to find a similar question answered on this forum and I am hoping that someone can help.

I have a mortgage on a property at the moment and have been paying it for a few years. I am now eligible to receive a interest free loan through my employer in order to put towards a house. I would like to use this money to buy a house in order to let it out (not a problem in itself), however I am only eligible if I do not already own a house.

What I am seeking to do is move the mortgage and property that I currently have mortgaged (sole owner) to my wifes name. This would allow me get the loan from my employer and get the ball moving on the second house.

Can anyone suggest the easiest way to do this and any pitfalls I may come across?

Thanks in advance!

Yorkie1

Are you the only person named on the deeds?

Does your wife earn a salary which would cover the mortgage?

What is the value of the house and of the outstanding mortgage?

somethingcorporate

The first three things that popped into my head were:

Would your employer be happy with you dissolving your interest in your current property to leverage an interest free loan from them?

What happens if you lose jobs or change employers?

Is there a stipulation from your employer that if you use their money to buy the house that you have to live in it?

TrickyDicky101

You are aware that the loan is a benefit upon which you will have to pay tax? You may find the tax liability is high enough to make it relatively uneconomic as a source of funding - especially as this will not be offsettable against your rental income.

firsttimer1986

Thankyou all for the quick replies.

In answer to the questions....the loan was initally for 98k on a 123k property (I have been paying the mortgage for about 2 years and overpaying it for about 50% of this time).

At the moment my wife is not working, what I was hoping to do is bring her onto the mortgage and then remove myself, and leave me as a garuntor. I am able to afford to do this but aware they will not give her a mortgage out right on her own.

My employer does not mind me selling to use their scheme, or require me to live in the house they pay towards. As the loan value is only small (aprox 8k) it just gives me enough to be able to get a decent mortgage when I add savings, and also if needs be I can just take 5k so that it does not attract any tax.

So:

Is it possible to add her, then remove myself a few months later. Is this easially done, or do I need to get her to purchase the property off me - albeit with her own mortgage but she may be working an able to secure this mortgage soon.

If I have to sell to her - can I sell for 95k so that her loan is easy to secure, any advice would help!

Cheers

Thrugelmir

firsttimer1986 wrote: »

At the moment my wife is not working, what I was hoping to do is bring her onto the mortgage and then remove myself, and leave me as a garuntor. I am able to afford to do this but aware they will not give her a mortgage out right on her own.

No income no mortgage. Your lender won't remove your name from current the mortgage. As you'll obviously still be paying it.

Trying_to_be_good

Are you military, by any chance?

You wouldn't be able to raise a second mortgage as you'd still be on the first, so all you'd have is the loan (or LSAP), and as others have said, will have to pay tax on it as it's a 'beneficial loan' i.e. below market-rate interest.

Why not concentrate on overpaying your current mortgage, as you've started to do? Over exposing yourself to the residential housing market would be a very bold move at a time of static or falling prices, even if you had enough cash to buy the second property!