Getting added to parents mortgage

VillaLion

Good morning all,

I have a current repayment mortgage on my house of £290k. My parents have an interest only mortgage of £250k. They are around 70 years old.

I would like to switch my mortgage to a buy-to-let (which I have been advised shouldn't be a problem getting consent to let until the mortgage expires). At the same time I would like to part-buy my parents property by remortgaging their property and get added to the deeds etc. I will be moving into the property.

The question I have is will I be able to get a mortgage with my parents due to their age? Their income wouldn't be needed as I will be able to cover this myself. Will lenders still take their age into consideration?

Thanks in advance,
VL

AnotherJoe

It depends. Someone here reported a similar situation whereby the parents equity was regarded as sufficient contribution. But there's no clue in your post if the house is worth £260 or a million So there's no way of knowing how much equity they are bringing to the table, if there's a lot of equity then I'd say it's doable with a small number of lenders. See a broker. And also I think you will have to pay the extra 3% SDLT.

VillaLion

Thanks Joe.

There's over 50% equity in the house so hopefully doable then. Any idea about which banks or building societies would entertain this situation?

You're right about the stamp duty... It would be payable on the consideration amount which in this instance should be £125k.

AnotherJoe

I cant recall for sure which one. It was in a post within the last week. Something is telling me Halifax but maybe it was HSBC?
Perhaps try searching in this thread or the house buying one, for "parents".

scottishblondie

HSBC allow the names on the mortgage to be different than the deeds under some circumstances, I'm not sure if First Direct may also allow it given that they are part of HSBC.

VillaLion

Thanks Blondie. Hopefully I can find a lender who will allow my parents to be on the mortgage, I guess almost as silent partners. If I can't then that HSBC solution can be a useful backup.

mrginge

You can't 'part-buy' a property.

AnotherJoe

Here we go ... it was HSBC https://forums.moneysavingexpert.com/discussion/5449642

Goldiegirl

VillaLion wrote: »

Thanks Blondie. Hopefully I can find a lender who will allow my parents to be on the mortgage, I guess almost as silent partners. If I can't then that HSBC solution can be a useful backup.

As your parents are already on their current mortgage, you could consider them applying for a 'transfer of equity', to get you added on to the existing mortgage. You'd also have to be added to the deeds as well, but a solicitor is instructed as part of the transaction, to deal with the legal work.

VillaLion

Good suggestion Goldie but the mortgage expires next year and I'd like to convert it into a repayment mortgage. I think it makes sense to try and get me added onto the deeds and mortgage when going through the remortgage process

Goldiegirl

it may be worth asking the lender - they may agree to extend the term of the mortgage and transfer to repayment as part of theTransfer of Equity.

I worked at the Halifax for many years, and it was quite normal for the term to be extended, or changed to repayment when a Transfer of Equity happened.