Desperate Mortgage Advice Needed

swindiff

OP is gifted nowhere near £50k

Dad gets £40k, for arguments sake mums share is protected at the same value £40k. Existing mortgage is £60k. Thats £140K on a property valued at £150k., There is no £50k gift, unless you conclude the the OP is getting mums share.

Irratus_Rusticus

swindiff wrote: »

OP is gifted nowhere near £50k

Dad gets £40k, for arguments sake mums share is protected at the same value £40k. Existing mortgage is £60k. Thats £140K on a property valued at £150k., There is no £50k gift, unless you conclude the the OP is getting mums share.

Dad gets £40K.

Existing mortgage is redeemed by OP getting a new mortgage to do so and to buy out dad's share.

House now in OP's name and worth £150K with a £100K mortgage. OP therefore has £50K in equity. That is the 'gift' as Op doesn't presently have a dog in the ring. Mum's share is protected as above.

If house was repossessed very early on, it's true OP gets little back after his mortgage is repaid and mum takes her share, other than any increase in value.

I'm not saying any of this is possible. Just going on advice OP seems to have received that it is.

But it works in theory.

swindiff

If mums share is protected then OP effectively has £10k equity, a little less after Solicitors fees and any other associated costs. And this still does not clear any of the OP existing debt.

Haydn_26

Yes that's much better than how I could have described it. My dad says id have to buy my mum out if we sold. I explained it wrong before. You have summarised better than I could

Haydn_26

We spoke to our FA on the phone. He said what we want to do is possible. He knows about my debt. He knows my mum will live with us. He knows everything and beleivea I can get a 100k mortgage. I'll keep you all posted

Pixie5740

I think you and your mum need to stop listening to what your dad says. It's not that I think he's giving out advice maliciously it's just that I don't think he necessarily knows what he is talking about.

Pixie5740

So does your mortgage broker know that you are only being gifted a £10k deposit as your mum isn't gifting you anything if a) she has a 2nd charge on the property and b) will be living in the property rent free.

Haydn_26

Pixie5740 wrote: »

So does your mortgage broker know that you are only being gifted a £10k deposit as your mum isn't gifting you anything if a) she has a 2nd charge on the property and b) will be living in the property rent free.

if this is how it pans out id still be able to purchase the property for 100k? My dad is willing to be flexible on his share to cover Amy fees.

Irratus_Rusticus

Haydn_26 wrote: »

if this is how it pans out id still be able to purchase the property for 100k? My dad is willing to be flexible on his share to cover Amy fees.

Hi again. To answer this it seems to me, if you have...

(a) taken advice from an independent financial adviser that the idea can fly and nobody is relying on dad's word (who may or may not know what he is talking about it is true but I see nothing so far that suggests he doesn't)

(b) a mortgage company has indicated it will lend what you need

(c) dad is, as you said earlier, clearing your debt to let you maximise a mortgage

(d) you can afford the mortgage payments now and going forward

(e) mum's interest can be protected while your mortgage company gets first dibs on the value should it repossess (so to it there is £50K surplus equity).

then you can in all the above circs presumably purchase the property for £100K and let the future take its course between you and mum, as dad will no longer have a dog in the ring.

If things work out and the house goes up in value both you and mum benefit (unless she is happy to have a set share).

Mum lives rent-free because she has her third share in the value to start with (within this deal) and has no reason to pay rent.

Admittedly it might get complicated but your parents have brought you to this point in life so mum's flexibility is fair to assume. She depends on you to pay the mortgage. If you default and the house has to go, she is fair to expect her share out of the sale first. Otherwise you both enjoy a valuable shared asset.

If a deal can be done...

All above of course depends on taking truly independent financial advice.

Good luck

Haydn_26

Irratus_Rusticus wrote: »

Hi again. To answer this it seems to me, if you have...

(a) taken advice from an independent financial adviser that the idea can fly and nobody is relying on dad's word (who may or may not know what he is talking about it is true but I see nothing so far that suggests he doesn't)

(b) a mortgage company has indicated it will lend what you need

(c) dad is, as you said earlie, clearing your debt to let you maximise a mortgage

(d) you can afford the mortgage payments now and going forward

(e) mum's interest can be protected while your mortgage company gets first dibs on the value should it repossess (so to it there is £50K surplus equity).

then you can in all the above circs presumably purchase the property for £100K and let the future take its course between you and mum, as dad will no longer have a dog in the ring.

If things work out and the house goes up in value both you and mum benefit (unless she is happy to have a set share).

Mum lives rent-free because she has her third share in the value to start with (within this deal) and has no reason to pay rent.

All above of course depends on taking truly independent financial advice.

Good luck

This is exactly what has been proposed to the FA, he says its dooable and we are meeting him next week. Glad you've been able to summarise it in a way I couldn't. I believe the banks call this a concessionary purchase unless I'm mistaken .