Paying back Dad.

Slybert07

Hi there, can anyone help me with a query. My Dad helped me get a deposit together for my house a few years ago and I made a promise to myself that I would return the money to him before he retired.

The only way I can get the money together is to borrow additional funds on my mortgage. Does anyone know if this is something banks/building societies will lend for? The building society I have my mortgage with says they will lend for buying out a 'partners' interest in the property .. but not Dads

Also is there any problem with my returning the money to my Dad ie Tax?

Thank you!

BoGoF

Is there any equity in the property to release?

There are no tax implications.

Slybert07

Okay, you might have to help me a little with that question. Let me tell you what I know - it's a shared ownership property of which I own half ... does that help?

BoGoF

Basically unless the property (or your share) is worth more than your mortgage (and a good bit more) then it is unlikely you can borrow more.

Slybert07

Ah I see. Well the property was worth £160,000 and I bought a 50% share but put down a £30,000 deposit so my mortgage now is only 41,000.. does that change the picture at all?

BoGoF

How much is it (realistically) worth now?

custardy

Slybert07 wrote: »

Hi there, can anyone help me with a query. My Dad helped me get a deposit together for my house a few years ago and I made a promise to myself that I would return the money to him before he retired.

The only way I can get the money together is to borrow additional funds on my mortgage. Does anyone know if this is something banks/building societies will lend for? The building society I have my mortgage with says they will lend for buying out a 'partners' interest in the property .. but not Dads

Also is there any problem with my returning the money to my Dad ie Tax?

Thank you!

how does your dad feel about this?
I would have thought the initial loan was t help you out and avoid borrowing.
kinda defeats the point
how much woul the repayments be,and how long would it take to pay your dad back on those payment levels?

Slybert07

BoGoF wrote: »

How much is it (realistically) worth now?

That's a really good question. I have heard that shared ownership homes keep their value (I have no idea how true that is though). Lets say its lost 10% of its value?

BoGoF

In all honesty there's no point 'guessing'.....have there been any recent sales around you that you can look up on zoopla?

pauletruth

depending on the current value of the property. at the moment your looking at a 90+% morgage plus fees and anyother related costs. you may just be able to get a loan but can you afford it. thats assuming the house has not lost any value. even losing 10k and you won't get a loan.

Apples2

I would be very surprised if ANY S/O house increased by a significant margin to wear this.

How much of the £30k deposit are we talking about?