Instalment contracts

incanndescent

My wife and I have been renting one of her father-in-law's properties. We have been discussing purchasing the property from them but due to our poor credit we'd be unable to get a mortgage through a provider. We've discussed an going into an instalment contract to continue paying them monthly only this time against the value of the property. My father-in-law has spoken to his solicitor in regards to this and she has stated that these are no longer legal in the UK. Can anyone confirm this?

If we are still able to purchase through this method, are there likely to be any issues with regards to insurance? Aside from what I have noted below, what other ramifications do we need to be aware of?

Other notes:
We want to purchase the house rather than inherit it as she has other siblings and we would rather be buying the house outright now rather than have to buy from them when the time comes.

We are aware of the risks, such as problems that defaulting would create (my credit problems arose in my change of career but am earning well now and, touch wood, are leaving those days behind). We have already made her siblings aware and there are no problems there.

We are aware of the likely CGT that would arise from this.

ACG

Pretty sure it can be done - http://www.islamicmortgages.co.uk/index.php?id=72 - Sharia Mortgages are not allowed to charge interest and so the the applicant would take out a Mortgage but each payment means they buy a little bit more of the house?

What bad credit do you have? I do a lot of "adverse credit" mortgages, it is possible to place bad credit it just depends what you have and when it was from.

Thrugelmir

incanndescent wrote: »

We are aware of the likely CGT that would arise from this.

The liability will crystallise when you purchase the property. Your FIL would need to fund this. Changes the dynamics somewhat.