Mortgage for someone else?

brooklyn07

Ok so cut a long story short - friend wants to get on the property ladder but can't get a mortgage because on paper she doesnt earn enough.

If i took out a mortgage in my name, all direct debits for bills etc would come out of my bank account but she would then pay me into my account each month and then eventually when she is in a position to be able to afford to take on the mortgage herself i would then transfer it over to her.

What would be the legal implications of me doing this? Could the council tax be in her name even though i own the house?

Thanks

quotememiserable

Well, there's nothing illegal about it. You should tell the bank when you borrow the money, and you need to consider the tax position of the arrangement - it sounds almost buy to let and the payment from her to you could be considered income and so taxable. Best talk to an accountant.
Plus of course, do you really trust her to be on time with payments. What if she hits a financial sticky patch.

starbarboy

Hi There

If you were to take a mortgage out on behalf of a friend it would not be the Council Tax that would be your main concern! However good a friend they are I would strongly advise against taking out credit on behalf of other people - it could easily end up in a broken friendship and thousands of pounds worth of debt in your name.

Best wishes

Stephen

Senior_Paper_Monitor

Certainly do-able (in various ways) - and certainly dangerous (on half a dozen counts or more).

Take professional advice on the structure from somewhere other than a internet public forum.