Sole Residential Mortgage into Joint Buy to Let

helpme_115

Hi Guys,

I'm currently in Birmingham and got a job in London meaning I need to move (or spend hours on trains everyday!). We dont have enough equity for a deposit so going to rent but would like to let out my house so we are still on the property ladder.

Whilst we could afford the mortgage still it would leave us very tight if the property was empty so have asked my sister if she would like to go 50/50 as a joint investment.

Im just wonder how we would go about working out how much she would need to put in to become equal partners and anything else we should consider.


Finances
House Purchase Price 2008: £105,000
Deposit on house (which my sister paid for): £5,000
Start of Mortgage: £100,000
Current Mortgage: £88,000 (All payments have been made by me)
Current Value (according to local sales and zoopla): £110,000

In my head (and I could be totally wrong) as I have paid £12k off the mortgage and sister has paid £5k, i own 70% and she owns 30%

To get to 50/50 she either needs to pay £7k into the mortgage or pay me £3,500 so we are even money wise but im not sure all this makes sense and is valid.

Can anyone else share their knowledge, experience etc?

Thanks

Ian

Thrugelmir

Why not reset the starting position.

There's a £5k paper gain. Share this in proportion to your equity in the property.

5/17 ths to your sister = £1,470.

12/17 ths to yourself = £3,530.

This then shares the equity £6,470 to your sister. £15,530 to yourself. Going forward any remaining equity is then shared 50/50.