Mortgage to buy out siblings from inherited property.

gilly_dc

Hello all. I have a bit of a tricky situation, and haven't been able to find a definite answer to my questions, and i'm hoping people may have some helpful answers!

Short Explanation...
My dad passed away last year, he left a flat to my two siblings and I that they've agreed I can buy them out of. I need to get a mortgage in order to do this, but i'm getting different answers on whether I can get a First Time Buyer mortgage, or that it would count as remortgaging (as I already hold equity in the property of my 1/3 I inherited) in which case some suggest you have to wait 6 months until you can remortgage. The probate has not been fully completed just yet.

Long Explanation...

I've got the flat valued by 3 different estate agents, and have agreed with my siblings to buy them out at the average price of these valuations which put the property at £310,000.

I need £206,000 to buy them both out. I've got savings of £128,000, so want to apply for a mortgage of £75,000. I like the look of the 5 year fixed at 2.99% with Yorkshire Building Society (http://www.ybs.co.uk/mortgages/fixed/products/5yr-fixed-30435.html)
If I wait till probate has been passed and the deeds to the house have been put into me and my siblings names, I would only qualify for a remortgage (as i'm already technically a home owner, so wouldnt be a first time buyer). In which case it seems from my research that you have to wait 6 months from owning a property to be able to get remortgage, and I feel that a lot of the good mortgage deals will have disappeared by then, and my siblings will have to wait longer to get their money.

When it comes to buying the property off my siblings, to get around the fact that I own 1/3, so couldn't apply for a first-time buyer mortgage, could I buy the property direct from the estate, before the deeds have been put over to me and my siblings names? In which case i'd be buying the property for only £206,000.

All of these different moving parts are making my head hurt!

ViolaLass

Being able to apply for a first-time buyer mortgage is not a big deal, it's just a marketing tool.

It would seem easiest if the estate were to sell you the property directly.

getmore4less

The legal owner is the estate, buy it off the estate should be a lot more straight forward if your income will support the lending required.

You might want to look at offset if you don't want to lose access to all your funds.

gilly_dc

getmore4less wrote: »

The legal owner is the estate, buy it off the estate should be a lot more straight forward if your income will support the lending required.

You might want to look at offset if you don't want to lose access to all your funds.

Thanks for the response.

When it comes to buying the property off the estate, how will this work when it comes to the mortgage? As if i'm buying it off the estate, so the deeds to the property won't be transferred in to me and my siblings names yet, would I count as already owning one third of the property?

And how will the mortgage company view this, as I assume the best way would be to buy the property off the estate at 2/3rds the price, which then gets split between my brother and sister? As opposed to me paying full price and just paying myself 1/3rd via the estate?

Very confusing!

Thrugelmir

Have you appointed a solicitor to handle the estate? If so speak to them for advice.

Mojisola

getmore4less wrote: »

The legal owner is the estate, buy it off the estate should be a lot more straight forward if your income will support the lending required.

Buy it directly off the estate - cleaner and easier.

Once the flat is in the three names, people can change their minds - don't want to sell, want a higher price, suggest renting it out for some years until house prices go up, etc.