transfer of equity

solidseven

Hi i have a joint mortgage with my sister and want to transfer her share of the equity to me, its a buy to let house but every broker says to remortgage as i do not earn £25,000 a year i do not wish to do this is i am able to pay the mortgage just fine is their another way around this perhaps court order against a lender? . Thanks

holly_hobby

If your current lender has a min earned income of 25k then thats the criteria you will have to meet to obtain their agreement to release your Sister.

So, you will need to remortgage to another BTL lender whom does not have the min income issue. (there are a couple)

You won't qualify for any fee free remortgage deal, due to the additional transfer of equity (TOE) between you and Sister.

If there are no monies or other consideration being exchanged in respect of the TOE, you won't be exposed to stamp duty, and she won't be exposed to CGT - if there is consideration taxes may be due.

Speaking of which, when you do sell the property you will be exposed to cgt on the whole gain (presuming it remains in your sole name).

Hope this helps

Holly

maninthestreet

A court order against the lender? Are you serious?

handytips

Thats what i thought !! Court order ?
I think we have a case of, wants to do something, but does not want to pay a bean. There is no such thing as Free my friend. Listen to the brokers they are correct.

koexelek

The Mortgage Works ( unlike virtually everyone else) do not require a minimum income for an applicant.

However, you'd still need to fit their criteria, and their products are not cheap

JimmyTheWig

What sort of court order were you thinking of, OP?

I guess if you could get a court to order a mortgage company to give you a mortgage despite not fitting their criteria then you might be on to something.
How you'd ever convince a court to grant such an order I have no idea!

Dave_Ham

Genius - magic..

This is the state of the world.. - court order!

On a side point, when you talk about you can pay the mortgage just fine without your Sister I am assuming you may be pulling a naughty and living there?

Otherwise I would have said that the tenant ensures the mortgage gets paid and if any issues, I can afford that amount...?

There are lenders (including TMW) who do not have minimum income requirements, but do have criteria..

Be careful with those court orders!

Simon_gloster

Dave_Ham wrote: »

Genius - magic..

This is the state of the world.. - court order!

On a side point, when you talk about you can pay the mortgage just fine without your Sister I am assuming you may be pulling a naughty and living there?

Otherwise I would have said that the tenant ensures the mortgage gets paid and if any issues, I can afford that amount...?

There are lenders (including TMW) who do not have minimum income requirements, but do have criteria..

Be careful with those court orders

Agree again Dave...

Moon on a stick.

star4876

with you saying "you want to transfer her share of the equity to you", I'm assuming your sister is in agreement ?!?!

Otherwise, you will need to buy her out, which makes it even less financially viable!

I dont understand why multiple brokers would tell you that you dont meet a £25k criteria so you can't remortgage with anybody. Don't get me wrong, if you earn NMW then there's probably not a lender out there that will give you a mortgage, but if you're not far off £25k then I would say they're not looking very hard. How big is the mortgage you want to take on?

holly_hobby

star4876 wrote: »

with you saying "you want to transfer her share of the equity to you", I'm assuming your sister is in agreement ?!?!

Otherwise, you will need to buy her out, which makes it even less financially viable!

I dont understand why multiple brokers would tell you that you dont meet a £25k criteria so you can't remortgage with anybody. Don't get me wrong, if you earn NMW then there's probably not a lender out there that will give you a mortgage, but if you're not far off £25k then I would say they're not looking very hard. How big is the mortgage you want to take on?

No, the current lender has a minimum 25k income criteria - which means that as she doesn't earn this, the sister can not be removed.

They have advised that the only way to proceed with the TOE would be to remortgage to another lender, who does not have the min income requirements.

The issue here, is that the OP simply does not want to leave the lender she is with .... despite her on a sole basis not meeting the reqd minimum criteria.
#
There are lenders who don't have the 25k min, this has already been discussed - its if she wants to accept that a remortgage is the only way to remove the sister.

A court order to "make " the current lender accept her is ridiculous and simply out of the question - so she has 2 options .. leave sister on and things as they are ... or remortgage to another BTL lender ... simples.

If the sister is not in agreement as you say, OP can not simply "buy her out" as that would also need her agreement.

The only way to forcibly remove her would be the judicial route.

Hope this helps clear those points up

Holly

star4876

Yeah but a transfer of equity is technically just an agreement to hand over your equity in a property, so if the sister isn't in agreement with the TofE its a buy-out and a remortgage regardless.

I dont understand why the loyalty to a lender? to change the mortgage from joint to single youve got to remortgage anyway.