Transfer of equity questions and stuff

doberman100

My partner and I live together, and she contributes about £200 a month (of the £730 mortgage) and has done for about 3 years now since we started living together. I get all the bills. We lived in my flat for about 2 years, and then moved to a house in early 2013. We considered getting a joint mortgage for that move but her credit rating was terrible so it was a non-starter. So I moved us and spent everything I had on costs and deposits etc. Her credit rating is back up now, so that's all good and we can get back on track.

So obviously she's keen to see that she gets a share of the increase in house price since we moved in, in early 2013 (which I'm fine with as we're a team), and generally wants to be on the title deeds too, as we're in a committed relationship and are getting married next summer. When I bought the house the lender made her sign this form about being booted out if I fled to Mexico and didn't pay the mortgage. A Letter of Consent, I believe.

Anyway, I had a chat with my lender and they are OK with my partner being on the title deeds now, so I *think* this means that instead of evicting her if I fled to Mexico they'd basically hold her liable for the mortgage - BUT it would legally mean that we're joint owners of the house, and she'll feel more a part of this house. She wants a bit of security and naturally hates having to pay me what is effectively rent - when all her friends are actually getting something for their money - i.e. they have joint mortgages. I was cool with adding her to the mortgage even though I'd spent effectively my life savings on moving into the house. I'm hell bent on making sure my partner is happy. Don't know any other way. The only caveat I have is that if it all went up in smoke I'd want to get back my deposit as that was my life's savings and I won't even go into what I went through to accumulate that but it's grim reading. Years before my partner and I met anyway.

In January I plan to get my partner added to the mortgage properly so we are both paying in, but we're waiting on that one as I'm just about to change jobs and so don't want that polluting the joint mortgage process.

My solicitor has quoted £900 including VAT to do a Transfer of Equity, which means in this case a change of the title deeds.

So my question is, do I understand the implications correctly here? My basic understanding is that with my partner on the title deeds she'll officially and legally be the joint owner of the house, even though she's not on the mortgage - which isn't possible yet as we have to wait until January for that. It's all good for her right?

As far as I can tell we're on track - Title deeds shortly, joint mortgage in January and then marriage next summer. She'll be tied in just like me and have protection and security through property equity since January 2013 and us being married.

CLAPTON

I would be surprised if your mortgage company would allow her being on the deeds without also being on the mortgage

doberman100

Yep - my solicitor said ask the lender first before even considering it, and they are ok with it. First Direct.:)

RickyC_IFSWP

It may be wise to wait until the mortgage is in joint names before changing the title deeds too.

Otherwise it seems ok. Good luck and congrats.

Thrugelmir

doberman100 wrote: »

Yep - my solicitor said ask the lender first before even considering it, and they are ok with it. First Direct.:)

Extremely unlikely. As creates all sorts of issues if not named on the mortgage.

kidmugsy

You may be wise to read up on the difference between the two forms of owning together - joint ownership, and tenants in common. You'd also be wise to draw up a deed defining the deal between you; in your shoes I'd also ensure that she understood that it's not just capital appreciation she'd share, but capital loss too.

UPDATE see comment 2 at
https://forums.moneysavingexpert.com/discussion/4993122

Goldiegirl

doberman100 wrote: »

So my question is, do I understand the implications correctly here? My basic understanding is that with my partner on the title deeds she'll officially and legally be the joint owner of the house, even though she's not on the mortgage - which isn't possible yet as we have to wait until January for that. It's all good for her right?

Most lenders require that the Deeds and the Mortgage are in the same names


Your solicitor won't change the Title without permission from the Lender, and the lender won't give permission unless the mortgage is changed to the new names on the Deeds


So effectively, both things happen at the same time - your solicitor will see to all this


You won't be able to do one part now and one part in January

ethank

I would ask for the confirmation in writing, you've probably been advised by someone in the contact centre, who may not know the policy, however if the lender agreed to a transfer of equity without a joint mortgage then it could affect their ability to reposess the property. Given that they wanted her to sign to say she had no interest in the property (if you ran away to Mexico), because of the lack of security it offered them, an underwriter is not going to agree to this.

General rule is that you can have more borrowers than owners, but you cannot have more owners than borrowers.