3 generations and 1 mortgage

n90bar

Ive been trying to find a mortgage that will allow 3 generations of a family (grandparents/parents/eldest child + partner) to live together but the house only being in 4 names I.e parents and eldest + partner.

Most of the mainstream lenders will only allow 2 borrowers or will not allow a gifted deposit from anyone who will live there (grandparents will provide this).

Is this sort of thing difficult to get a lender to agree?

Idea is grandparents will provide 50% of the deposit remaining 50% from ourselves and the 4 earners will have house in their names and will pay mortgage.

Dave_Ham

This can be done, although rather than the mortgage the issue may be in the ownership..

If the grandparents want to be on the deeds etc. or having a charge, this would be a virtual dealbreaker..

If they do not, they would need to be careful for later in life for decreasing their assets (there is another word which cannot spell this time of a Saturday)

It can be pieced together but do get decent legal and mortgage representation...

n90bar

Thanks Dave

No they aren't looking to be in the mortgage they will be looking to gift us the cash from the sale proceeds. Is this something most mortgage brokers be familiar with or should we be looking for a specialist?

Dave_Ham

I would like to say any, but with some of the plums in the industry I am not sure.

Would give any estate agent brokers a wide berth...

n90bar

Thank ou

I do haves broker I've used on previous 2 purchasers - will check with her. Do the lenders usually allow all 4 incomes to be taken into account?

Dave_Ham

Definitely not - most first 2 and a couple use 3

holly_hobby

Mge lenders ( who accept multiple applicants) tend to have max 4 mortgagors allowed (although not all 4 incomes will be used within the borrowing multiple).

The issue you will have in this instance is that the mge app must reflect the names on the title deeds, so if grandparents are to go on the deeds, then they will also need to be on the app too (even if their income is not reqd).

You will then have max term issues dictated by the lenders maximum age at redemption (which will be applied to the eldest applicant).

Income wise you won't get a joint multiple of 3 incomes, and you'll find its probably 3 x main, +1 of the 2nd, + 1 of the 3rd (or something along those lines).

The gifted deposit is an issue re grandparents living in the property as by taking residence, it appears to the lender that the gift is not without reservation, but that the capital has actually purchased their residence within in the property - and in their view could lead to a proprietary claim in any possession order (ie re obtaining vacant possession).

Could this be avoided by the monies being deposited with you a little while before you enter the purchase process, so it could be claimed to be a simple gift between parent and child, and not directly gifted to fund the property purchase ? Although the fact your parents will be declared as being resident on the mge app re consent to vacate issues (which is standard for all residents aged 17yrs +, whom are not party to the mge), may prompt them to dig a bit more, of it may not even raise an eyebrow.

Of course your parents need to be aware that if not on the deeds, and repossession should occur, they will lose their home as well as the rest of the family.

You need to cover a few bases with the adviser , and I think if you don't see a Financial and Wealth Adviser for the mge, you need to visit one as a sep issue, re any long term care provision issues (re deprevation of assets re state assisted care, possibly evidenced by the sale of grandparents home & gifting of monies), in addition to IHT and estate planning issues, that may also raise their head as part of the exercise - of which a dedicated mortgage broker may not be qualified to advise upon (although they may be able to direct you suitably qualified pracitioners in your area on a referall basis).

Your broker will have a good look at the situation, and tailor a package to obtain the best solution covering all bases (if possible) - but having gparents actually party to the mge/deeds may not be an option, or may be hugely restrictive due to max term issues.

So you may need to discuss with them how happy they would be to have no legal protection or claim re ownership/selling of the property and their security.

Lot to think over and discucss ....

Hope this helps and Good luck

Holly x

getmore4less

Only 4 entities can own a property.

To have more you need a trust.

Having parents provide 50% of the purchase price and then have no interest in the property but still be living there will be an issue for some lenders.

CBR600F_2

You must be close family. I'd start snapping necks if I had to live with my family like that. Damn.