Private Mortgage

pompeyfan1

Good Morning

My Dad bought me a house a year ago in cash and would like it out of his name, he wants me to get a 60k mortgage, the house was recently valued at 190k.

I am struggling to get a mortgage.

I’ve been reading about private mortgages but before I suggest this to my dad does anyone know if this is a good way to go. My dad is not in need of the money he would just like the house in my name.

So if I’ve got it right no money will change hands, it would just mean the house being in my name not his.

Any help would be great.

Many thanks

kingstreet

pompeyfan1 wrote: »

I am struggling to get a mortgage

Why? What's the problem?

pompeyfan1

I have no credit history.

kingstreet

In which case, a non-scoring lender like a smaller building society may be a better bet.

You'll need one happy to accept the purchase at undervalue as your deposit.

A broker might be your best bet with this, to find the best combination of lender and rate.

pompeyfan1

So you think the private mortgage is not worth suggesting?

kingstreet

I suspect such business is centred on larger amounts and more valuable property types. In 28 years, I've never come across such facilities here in the Midlands.

I also suspect you would not get as good a rate.

pompeyfan1

It would be a private mortgage between me and my Dad. No money would change hand he just wants the house out of his name.

kingstreet

Ok.

So there's no mortgage on the property at the moment and you don't have to pay him anything?

Do a transfer of equity and have the property transferred into your name. Then, he takes a charge over the property and a legal agreement is made confirming how much you are going to pay back, when, and what interest (if any) is payable.

There will be stamp duty implications;-

http://www.hmrc.gov.uk/sdlt/calculate/transfer-ownership.htm

pompeyfan1

Thats what i am trying to avoid!

Is a private mortgage not a way round stamp duty?

pompeyfan1

kingstreet wrote: »

Ok.

So there's no mortgage on the property at the moment and you don't have to pay him anything?

http://www.hmrc.gov.uk/sdlt/calculate/transfer-ownership.htm

Thats correct no mortgage on the house all was paid in cash!

Wywth

pompeyfan1 wrote: »

Good Morning

My Dad bought me a house a year ago in cash and would like it out of his name, he wants me to get a 60k mortgage, the house was recently valued at 190k.

I am struggling to get a mortgage.

I’ve been reading about private mortgages but before I suggest this to my dad does anyone know if this is a good way to go. My dad is not in need of the money he would just like the house in my name.

So if I’ve got it right no money will change hands, it would just mean the house being in my name not his.

Any help would be great.

Many thanks

I'm sorry, but I am not sure you have got things right here.

Why is your father asking you to get a £60k mortgage on a property that he already owns, and doesn't expect to receive any payment for? What would you do with the £60k if you ever got it? You don't need a mortgage to simply have the property in your name - your father never got one it would appear.

I suggest you clarify the situation with your father.