Remortgage, Single to Joint...

Scotty_Dog

Having done a little research, can anyone advise on the best approach to this issue.

I live with my wife (recently married) and the house and current mortgage are solely in her name. We are looking to remortgage as the current fixed rate has ended and take the opportunity to move to a joint mortgage.

Questions:

1. Are there any costs other than a c.£100 lenders admin fee (e.g. stamp duty)? House value is above stamp duty limit, half of mortgage value is below it (but whole of mortgage amount exceeds it).

2. I've been told that we cannot go from single to joint on a remortgage as they have to be like for like. So.... do we
i) Add me to the current mortgage and then remortgage (likely different lender)
ii) Remortgage as a single application and then add me on afterwards?
iii) Have I been mis-informed about and there is a third way e.g. straight from single to joint remortgage?

In terms of the remortgage, the amount borrowed does not increase, nor does the term extend. Just a straight move of the mortgage amount.

Thank you in advance for any help anyone can offer.

kingstreet

This is a transfer of equity, first and foremost.

That means someone is being added to the ownership of the property and this means legal costs of perhaps £450 to £600 AND liability to SDLT if the current mortgage is more than £250k* (or if one of you owns another property as well).

You have two choices.

You can ask the current lender to add you to the existing mortgage or you can apply for a new mortgage with a new lender on a joint basis. When finalised, the solicitor will complete the ToE and mortgage and you will have a jointly owned property and a joint mortgage.

*The consideration for SDLT is 50% of the existing mortgage,so if under £250k, the consideration would be £0.

Scotty_Dog

Thanks for that kingstreet. Looks like I am ok from a stamp duty point of view as mortgage less than £250k. Just the legal fees. Does seem a bit of a con when this sort o f thing is probably much more common these days. And HMRC rarely miss a trick to take even more money off me. Thanks again.

Thrugelmir

Scotty_Dog wrote: »

Does seem a bit of a con when this sort o f thing is probably much more common these days. And HMRC rarely miss a trick to take even more money off me.

Rules are brought in to block tax avoidance loopholes that otherwise would be exploited.

Why do you want to be added to the mortgage?

pathtofreedom

Do you NEED to be on the mortgage? Is it because you want to borrow more money for some reason, and extension or something, and you need to be added to meet affordably? There isn't a rule you both have to be on it, why not just do it in her name again, if there are any deals with her current bank for retaining customers it would save you money in solicitor costs etc in the long run.

pathtofreedom

Just to add, it probably depends on your age and future plans as well. If you want to have kids at some point or move house as her house isn't your forever house, to me it would make more sense just waiting to do a joint application on the new place, rather than wasting money on it now. If it is your forever home, you don't need more space for kids, dogs, man caves or anything, why do you want to be on the mortgage? How much is left to pay? Why not just wait till it is paid off then change the ownership once you've been together a lot longer if it is important to you to be on the deeds for whatever reason. If god forbid you do split up, having it only in one name would be a lot easier for a cleaner split later and organising your finances accordingly.