Offered share in House ADVICE PLEASE

RusholmeRuffian

Dear all

I have been offered a share in my friend's house. Here are the details.

Bought roughly one year ago with a £12,000 deposit for £120,000.
Now worth £160,000 following works at an undisclosed cost.
Mortgage payments are roughly £550 per month.

I have between £10,000 and £15,000 to invest. What % should this equate to? This has been causing me some trouble for a while, any help would be welcomed.

Thanks in advance.

pinkshoes

If you have £10k and the property is worth £160k, then your share is worth 10/160%. (6.25%).

Why does this person want/need an investor? Is the market not nearing a peak in your area?

Pixie5740

I can think of much better ways of investing £10k to £15k.

What kind of return are you expecting on your investment and when do you expect to be able to realise this return as cold hard cash? What if the value of the property drops? What if your friend doesn't want to sell or buy you out when you need that capital back?

It sounds like a huge headache in the making. AVOID.

Beckyy

I would avoid it like the plague!

You'd need to go onto the mortgage, including passing checks from the lender, and be liable for the mortgage debt if your friend couldn't pay. It could also lead to big problem if one party wanted out and the other didn't.

You could invest your money much easier and better elsewhere IMO.

jamie11

These sorts of arrangements usually mean your friend will soon be an ex-friend, with you as the loser.

Put your money to use elsewhere.

mrginge

RusholmeRuffian wrote: »

Dear all

I have been offered a share in my friend's house. Here are the details.

Bought roughly one year ago with a £12,000 deposit for £120,000.
Now worth £160,000 following works at an undisclosed cost.
Mortgage payments are roughly £550 per month.

I have between £10,000 and £15,000 to invest. What % should this equate to? This has been causing me some trouble for a while, any help would be welcomed.

Thanks in advance.

How do you know its worth 160k?
What return are you getting for your investment?
How long are you investing for?
What exit conditions are in place (for both of you)?
What proportion of your investment will be required to pay any ERC ( given you will need to remortgage)?
Who lives in the house?
Are you comfortable with being named on this mortgage and the impact it may have on any future personal mortgage you may require?

densol_2

No no no - for all the above valid points and reasons

If you are stuck on the mortgage you may not be able to get another !

Your value is so small it would not be economically viable to force a sale if you had to

" its been causing me trouble " .... Already a headache !

I could not think of a worst investment ( well I could but the organisers usually get done for fraud.

Save your money for an easier safer investment