Partner Contributing to Mortgage Payments

Weyoun

Hi all,

My partner and I have started the process of buying a house. Unfortunately our chosen mortgage lender wasn't willing to give us a joint mortgage as my partner already has another mortgage elsewhere, so we decided I should apply alone.

Despite this, we both wish to contribute to the payments. Is it simply a case of my partner regularly transferring her portion of the payment to me and me paying the lender our combined amount, or would the transfer of her funds to me need to be declared / subject to tax? If the latter, is there a way around this, such as by using a joint bank account?

Thanks,
W.

mrginge

It's the former.

You are aware that by contributing to the mortgage your partner will gain a beneficial interest in the property should you split up. Not that this may necessarily be a problem of course.

HappyMJ

Weyoun wrote: »

Hi all,

My partner and I have started the process of buying a house. Unfortunately our chosen mortgage lender wasn't willing to give us a joint mortgage as my partner already has another mortgage elsewhere, so we decided I should apply alone.

Despite this, we both wish to contribute to the payments. Is it simply a case of my partner regularly transferring her portion of the payment to me and me paying the lender our combined amount, or would the transfer of her funds to me need to be declared / subject to tax? If the latter, is there a way around this, such as by using a joint bank account?

Thanks,
W.

Could your partner get rid of the mortgage elsewhere? If it's s normal mortgage with consent to let or a buy to let mortgage or even a mortgage in which your partner's former family live you shouldn't have any problem getting a mortgage as long as it's affordable.

Your partner can be on the mortgage with no income of their own so I can't see what the problem might be.

Weyoun

mrginge wrote: »

It's the former.

You are aware that by contributing to the mortgage your partner will gain a beneficial interest in the property should you split up. Not that this may necessarily be a problem of course.

Thanks mrginge. It looks like it will be ok for her to pay a share then. Yes I'm aware she will have an interest in the property; this is not a problem.

HappyMJ wrote: »

Could your partner get rid of the mortgage elsewhere? If it's s normal mortgage with consent to let or a buy to let mortgage or even a mortgage in which your partner's former family live you shouldn't have any problem getting a mortgage as long as it's affordable.

Your partner can be on the mortgage with no income of their own so I can't see what the problem might be.

We've both been living in a property that she bought on her own before we met. She has been trying to sell the property and pay off her original mortgage but without any luck.

Even though my partner's current mortgage payments are quite low and she has sufficient surplus income to contribute to a joint mortgage, the new lender has refused to take her income into account. I am informed that had we had applied jointly, the lender would have considered my partner to be a dependent upon me, thus reducing the amount I'd be able to afford to repay per month, even though in reality this would not be the case.

Just this particular lender's rules, I suppose.

HappyMJ

Weyoun wrote: »

Thanks mrginge. It looks like it will be ok for her to pay a share then. Yes I'm aware she will have an interest in the property; this is not a problem.



We've both been living in a property that she bought on her own before we met. She has been trying to sell the property and pay off her original mortgage but without any luck.

Even though my partner's current mortgage payments are quite low and she has sufficient surplus income to contribute to a joint mortgage, the new lender has refused to take her income into account. I am informed that had we had applied jointly, the lender would have considered my partner to be a dependent upon me, thus reducing the amount I'd be able to afford to repay per month, even though in reality this would not be the case.

Just this particular lender's rules, I suppose.

Remortgage it as a buy-to-let, move out when you buy the new house and you can get joint mortgage together.

Go to another lender.

The problem is if you buy the house solely in your name she has no security. It's your house you can kick her out at any time...you don't have to buy her out. If you die your house goes to your heirs and she's homeless unless you set up a will which is just going to cost more money. She can't take on the mortgage as she's not on it so the house will be sold to repay the mortgage so you must have life insurance to cover the value of the mortgage.

I'm sorry but I'd never move in with someone if I wasn't on the mortgage...and therefore the deeds. Look for another solution.

kingstreet

Weyoun wrote: »

the new lender has refused to take her income into account. I am informed that had we had applied jointly, the lender would have considered my partner to be a dependent upon me

You picked the wrong lender for the circumstances.

Most lenders would not have done this. It's now more usual for the mortgage payment to be treated as a credit commitment, rather than the capital balance be deducted from maximum borrowing power.

I'm going to guess at Nationwide, Coventry, Leeds or Yorkshire BS?

Weyoun

HappyMJ wrote: »

The problem is if you buy the house solely in your name she has no security. It's your house you can kick her out at any time...

The intention is to sell the existing house quickly, say, by auction, then add her to the mortgage / deeds.

It may well be that I could kick her out at any time, but just because I could, doesn't mean I would. I realise you only have my word for it, but I do have some integrity!

kingstreet wrote: »

You picked the wrong lender for the circumstances.

A mortgage advisor picked it for us, after being informed of our circumstances. It was through him we were advised that my partner could not be named on the new mortgage as long as she has an existing one.

kingstreet wrote: »

I'm going to guess at Nationwide, Coventry, Leeds or Yorkshire BS?

The lender is indeed one of those you quoted. I'll not tell you which, though

Red-Squirrel_2

Weyoun wrote: »

It may well be that I could kick her out at any time, but just because I could, doesn't mean I would. I realise you only have my word for it, but I do have some integrity!

I'm sure you do, but none of us can predict the future and its incredible how drastically feelings can change. One of the most loving things you can do for a partner is to set things up so that they will be protected and treated fairly even if you stop loving them or even start hating them.

kingstreet

Wrong broker and wrong lender.

Quality research then.

Do you plan to ask your broker any pointed questions about their knowledge or experience?

YBS is direct-only. Coventry allows only one residential mortgage. Nationwide aggregates the loan amounts unless you have three months rental income evidence.

Weyoun

kingstreet wrote: »

Wrong broker and wrong lender.

Why is it the wrong lender? If, as mrginge stated, my partner can pay her share of the payments via me, and disregarding any trust issues or what-ifs relating to our relationship which aren't really relevant to my original question, it would seem to be the right lender to me.

Are you suggesting that mrginge is incorrect? Please do tell me if that is so, as that is what I wanted to know, hence my original question!

Weyoun

Red-Squirrel wrote: »

I'm sure you do, but none of us can predict the future and its incredible how drastically feelings can change. One of the most loving things you can do for a partner is to set things up so that they will be protected and treated fairly even if you stop loving them or even start hating them.

Which is precisely why, once she has sold her existing property (as quickly as possible) we would look to add her name to the deeds and/or mortgage so that she has some security.