First time buyer with a complicated situation! Mortgage help pls!

Cat1

Hello!

I'm hoping to buy a 3 or 4 bed property up to about 200k.

I've come into some inheritance. I will have approx 50k and my 3 children will have about 100k. The childrens money is to be held in trust until they are 18 but can be used earlier for their maintenance or education. The solicitor has advised the terms are very flexible and what I would like to do is invest their share in property for us all to live in, and then release their share as each child turns 18 (they are currently 12, 4 & 2)

I earn approx 9k a year working part time. I've never defaulted on anything and I have a few credit cards and a small car loan.

What are the chances of being able to obtain a mortgage under these circumstances?

Simon_gloster

Im afraid just based on your income and 3 children you wouldnt be able to borrow 1p.

System

How would you release the children's share?

Simon_gloster

Flexibld trust doesn't sound 'trusty' to me.

What you have to think of is IF you buy outright, how will you pay them back? You'll need a higher income when the eldeat hits 18. 30k pa would probably do it.

If you cant or dont then their share is tied up in that house.

Doesnt stack up now or in the futurs is my opinion.

Cat1

Sorry for the delay in replying. Simon you have hit the nail on the head - I was thinking I would remortgage the property when each child hits 18. Youngest child is 2yrs old at the moment.

So with a 50k deposit and a 9k part time salary there is no hope of getting a mortgage at all? Can tax credits / disability benefits be taken into account for income purposes?

property.advert

Only chance is to use the kids' inheritance to buy a property outright. After fees and stuff, you could probably look at property up to £135k or so.

Ownership would not be a problem but issues could arise when the children reached maturity and perhaps wanted their share, leaving you essentially homeless if you were forced to sell.

It could be structured so that they retained their percentage of equity but that you have the right to reside in the property for your lifetime and cannot be forced out.

You may need to consider what would happen if you wanted to move but I would also want to see a restriction on you obtaining any advance with the property as security as this could undermine their inheritance.

Then a will leaving your share to them and not to any future partner.

Cat1

Thank you property advert - really helpful There are a few properties on the market in that price range so there may be hope!