taking someone off a three named mortgage

kcishepps

hi. i currently have a mortgage with nationwide with my 2 brothers. this came about after being left the house after our mother passed. one brother now wants to come off as he wants to buy his own place and wouldnt be given a second mortgage (even though he is not contributing to this one). after speaking to many departments within nationwide, i am still none the wiser whether this can happen. some departments are saying it should be able to be done and would include a transfer of equity and others are saying they cannot do it at all as it is too complex to take a mortgage from three names down to two. could you shed any light on the situation?

ACG

It can be done theoretically.

But nationwide will need to assess the application and if acceptable then do a Transfer of equity.

Alternatively, speak to a new lender and apply in 2 names only.

Thrugelmir

Are you buying your brother out of his share?

kcishepps

No we re not buying him out

Sarahspangles

I think your problem is that Nationwide aren't clear what you are trying to do so you are getting different answers.

The way mortgage lenders work, they want the "First Charge" on the property. This means that when the property is sold, or if they have to repossess it, they get their money back before anyone else does.

There are problems for the bank if your brother owns part of the house, but isn't on the mortgage. If they need to repossess it, they couldn't sell it without his agreement, and if at that point it was in negative equity then he might get his share first, and as a result they might make more loss than they would if they could make the mortgage holders bear the loss.

For these reasons, normally lenders like to get to a position where everyone who owns a property is also a party to the mortgage. To achieve this, you would have to remortgage to buy him out of his share of the equity in the property (the difference between what the property is worth and the mortgage).

amnblog

They won't let your brother off of the mortgage unless he is coming off of the ownership also.

To do so would provide them with risk they neither want nor need.

The three of you should get yourselves some advice from a Mortgage Broker on the options possible.