What a nightmare!

xyyman

Hello to all,

I am looking for thoughts and advice to help me sort out this nightmare. Basically I don't trust the banks or building societies to offer me impartial advice and because I find the whole thing very confusing I need help.

I am coming to the end of the first three years of a tracker mortgage I have with the Nationwide and as of November the rate will increase to nearly 6% so I am looking for a better deal for the rest of the term, 20yrs.

In addition my failing mother wants to sell her property, totally paid, to move closer to me so I can offer her support. As she has little savings it seems that I will have to try to generate some capital, maybe through remortgage, to meet a shortfall as property prices here are higher than where she is living. Her property woul fund about 75% of a new house. Through pensions she can contribute to the monthly payment to cover the extra and as sole benificiary of her will I should gain her estate on her death so I guess this is a safteynet as I could sell her property to clear the outstanding mortgage or indeed rent it out to give me a regular extra income. She is willing to have my name added to the deeds of her new property as joint owner.

I really need to know what is the best way to approach this. Hope all of that make sense.

Fairdo_2

There are ways to help.

To be fair, we would need to have a better idea of the overall picture, before being able to suggest options.

One of the more obvious solutions (if there is enougth equity and you have enough income to cover the affordability) would be to Remortgage on a Capital Raising basis on your own property and you could help your Mum buy outright, once she has sold hers.

I would strongly suggest you speak to a qualified Tax Advisor, regarding the consequences of putting your name on her Title Deeds and the best way to maximise your options at the time when you may need to deal with the Estate.

The sort of information required would be things like an idea of earnings, your current mortgage and any other credit commitments (detailed seperately) and how much your home would realistically be valued at.

Along with this, we would need to know what you would need to buy at and how much extra you would need to borrow.

I would love to say that I will be able to respond later, but I may have to disappear Today as my wife seems to be in the early stages of labour. (Not the election type).

There should be a few contributors available to help if I am not around though.

Good luck

xyyman

I will list some details Later. Many thanks and best wishes to you both.

xyyman

For information....

My property is valued at £165,000. Outstanding mortgage is £82,000.

My Mothers property is valued at £110,000. Owned.

We are looking to buy for her at £130,000.

Her disposable income is £7500 p/a

My disposable income is £5000 p/a

Disposable incomes are net after all stopages.

Hope that helps...

herbiesjp

You have enough equity in your property to do exactly what you want to.

Raise extra £20k approx to help mum buy new property outright at price of around £130k.

My only warning here would be on the affordability front - you need to look at the figures and see how much extra this is going to cost you and work it from there.

At that loan to value you wil have the pick of the rates on the market.

Fairdo_2

I could really do with your gross annual income please. Is your current mortgage in your own name?

If not, I'd also need the other persons income aswell.

If you'd prefer not to give personal info on the thread, then please feel free to pm me.

I'd try to get back to you Today, as long as I don't get that phone call.

Fairdo_2

Further to Herbies post, the only thing I'd warn you is that you would need to take into account buying and selling costs for your mum, so I'd expect you'd need to allow more than £20,000 additional borrowing, unless you have savings elsewhere to call upon.

xyyman

I have a joint mortgage.

My gross income is £12,500 from self employment.

My partner earns £25,500 gross from full time employment

Mum gets £10,000 from benitifs plus state and private pensions

Mum has about £3000 in savings

We have very little.. less than £1000

whatif_2

What ever you decide, be mindful of the long term care issue.

If for any reason your mother needs to go into care then the local government will expect the care to be paid for via your mother assets (including home). Make sure your equity in the property is well documented.

xyyman

Do you know if I would be forced to sell if we had joint ownership?

whatif_2

I don't believe they would force a sale either way. They operate differed payment schemes whereby they pay the care cost and place a charge over the property and then recover any monies paid when the property is finally sold.