Shared ownership with parents/mortgage: advice please

brightonian

Hi

My partner and I are renting currently, and starting to save a deposit for a house. Now, my mother-in-law has found an ideal house for us and is willing to buy it and rent it to us at the same rate she is currently getting on the interest from her savings.

The house is worth more than we could currently get a mortgage on ourselves, but we'd be interested in "buying out" a percentage, like a normal "shared ownership" scheme, through a mortgage, say for 50% of the value of the house and then pay her the difference in rent, so that we can improve it etc and, when the time comes to sell it, we benefit and she benefits from the increased value of the house, or we could buy her out completely in the future.

Are there any products available which would allow this arrangement to take place, without naming her on the mortgage? Obviously if it were just a plot of land you could divide it into two legal entities and that would be fine, but, as it's got a house on it, that's obviously more complex.

Basically she wants to know her money is as safe as the market value of the house over a number of years and doesn't want to be involved in the mortgage side of it.

Thanks to anyone who can give (sensible!) advice

Conrad

All parties to a property deed, have to be party to a mortgage deed. This is to allow a lender unfettered rights in the unfortunate event of repossesion. They cannot entertain a situation where one party, your MIL, stops repossession proceedings on account of her having part ownership in the property.

There's a way to do this, but it's too complex to explain here. Maybe try a GOOD small local broker that knows what thye're doing.

Good luck.