Helping daughter

Jasperju

Hi,
My daughter and son-in-law want to buy the house they are currently renting!
Landlord is looking to sell in August.
Unfortunately they are both bad credit risks per experian.
He has CCJ and she has a default.
The house is only £130k and they are around the 10% deposit level, but won't make 15% or higher in time.
I'm not tied to a mortgage and have good credit and could cover 25 to 30% deposit.
What, if any options do we have?
Is there anyway they could get a mortgage with me as guarantor?
Could I buy it with my daughter, as a residential mortgage without living there? Is this legal.
I'm trying to avoid the buy to let option!
Thanks

GMS

When were the CCJ and default put in place and for how much? Have they been satisfied?

It may be possible for you to raise the deposit on your house and they raise a mortgage for the remainder.

Probably best to speak to a broker.

Jasperju

The CCJ is about 1700 and not satisfied. The default is satisfied and around 200

GMS

Jasperju wrote: »

The CCJ is about 1700 and not satisfied. The default is satisfied and around 200

When were they put in place? Could the CCJ be satisfied prior to an application?

ValHaller

Jasperju wrote: »

The CCJ is about 1700 and not satisfied. The default is satisfied and around 200

Why do they have a £13000 deposit and an unsatisfied CCJ for a trifling £1700? It just ain't sensible.

Jasperju

Good point! They are (were) not sensible at all. Its taken me several years of badgering to get them to get there heads screwed on. Ill have a look at the CCJ and see if we can clear it.
But the idea was to leave him off the mortgage for now and wait for the CCJ to drop off. Would anyone consider a 10% deposit and a satisfied CCJ?

holly_hobby

At 90% ltv they may need some daylight between CCJ satisfaction (with cert of satisfaction from the court) and application, together with an acceptable reason for the CCJ and a demonstration to change of financial circs from that point to now.

I say this because if they immediately apply following CCJ satisfaction (unless the CCJ was unknown to them until recently), it will appear to the lender that the CCJ has only been satisfied to facilitate a mge application (ie for personal reasons and to obtain further credit), as oppossed to satisfaction under obligation whilst demonstrating financial maturity and responsibility, which is what the lender is looking for.

To that end and at a high LTV with 2 blips (CCJ and default), I would possibly be more inclined to approach a lender that doesn't credit score ... a lower LTV with your gifted deposit (if a true gift made with no requirement of repayment or return) may open up more possibilities, but as I say the basis of the poor credit and satisfaction will have to be acceptable to the UWs.

Alternatively, you could purchase the property under a regulated BTL - however this will expose you to SA tax returns on rental income (whether charged or not), and CGT assessment on sale or transfer to your child (once their credit is clean if they need a mge to facilitie the tsf).

Given the paramaters I would strongly advise you engage the advice of a whole of market mge broker, whom will bounce the enquiry off their sources and advise accordingly.

Hope this helps

Holly