Stamp duty assistance

paintedtoenails

Hello There,

I'm just after some assistance regarding stamp duty.

My name is on a mortgage for a house that my ex partner and 2 children live in. I have not lived in the house or paid anything towards the mortgage since 2008.

I now have the deposit to purchase a new house with my current partner (we are not married yet). My partner is a first-time buyer.

Will we have to pay the higher rate of stamp duty because my name is on the other mortgage, if so is there a way around this??

Thanks

Dan

Bluebirdman_of_Alcathays

Yes, you own 1 house and soon you will own 2 - the higher rate will apply.

mije1983

paintedtoenails wrote: »

Will we have to pay the higher rate of stamp duty

Yes (depending on property prices)

paintedtoenails wrote: »

is there a way around this??

Remove yourself from any association with the first property.

Is there a reason you are still listed on the mortgage after 8 years? Obviously if the reason you are still on it is because your ex partner couldn't afford a mortgage on their own, then you won't be able to remove yourself easily.

POPPYOSCAR

It would appear so

http://www.primelocation.com/discover/buying/guide-to-the-3-stamp-duty-surcharge/#yVOsqBIMDB81fagm.97

What if I am buying with a partner who doesn’t already own?
If you have a second home and you are buying jointly with your partner who doesn’t already own, the 3% Stamp Duty surcharge will still apply.

Just as if you were buying for your child, you may be able to escape the surcharge here by putting the property entirely in the name of the person who doesn’t already own a home.

Ray Boulger, senior technical director at mortgage broker, John Charcol, said: “If you can’t satisfy the lender’s affordability criteria in just one person’s name, some lenders such as Metro Bank and The Woolwich, will allow you to put two names on the mortgage, and just one the property deeds.”


Read more at http://www.primelocation.com/discover/buying/guide-to-the-3-stamp-duty-surcharge/#rzVSPW2wutuiCCdY.99

paintedtoenails

I have been trying to remove my name from the mortgage for the last 8 years but I am unable to because my ex partner doesn't earn enough to have the mortgage in her own name. She won't agree to sell the house, so I am stuck.

mije1983

You could go to court to try and force a sale, but it won't be quick or cheap. Of course you'd also have to consider the effect on your children and where they would live if your ex could only afford a 1 bed place. However, in the long term, it may be the best option if she is not being co-operative. Don't forget that you are as liable for the mortgage repayments as she is at the moment.

Are you able to get a 2nd mortgage while you are still listed on the first one?

paintedtoenails

I have seen a solicitor about getting my name removed and it is likely that a court would grant it but it would cost around £10,000.

Yes, i can get a 2nd mortgage. I've seen a financial advisor and can lend what I need taking in to account my name being on the other mortgage.

It just seems a bit unfair that I have to pay around £5000 more in stamp duty than if my name wasn't on the other mortgage.

marliepanda

Unfortunately your name IS on the other mortgage, so you have to pay the additional property surcharge. There is no way around it whilst adding another property to your ownership.

I am not sure what is unfair really. You are currently providing a home (through mortgage association) for your two children, and now want to buy another home.

kingstreet

Being on a mortgage does not confer ownership nor does it mean you have to pay the SDLT surcharge.

The question here is, are you co-owner of the property, or were you removed from the ownership as part of a settlement, divorce perhaps?

Guarantors are party to a mortgage but not to the property ownership and in the same way are also not liable for SDLT surcharge.

tlc678910

Ask your solicitor if coming off the deeds but remaining on the mortgage (as suggested by PoppyOscar above) would remove the second stamp duty. If so you could look into that.
Tlc

G_M

paintedtoenails wrote: »

My name is on a mortgage for a house that my ex partner and 2 children live in. .....

I now have the deposit to purchase a new house with my current partner (we are not married yet). My partner is a first-time buyer.

Will we have to pay the higher rate of stamp duty because my name is on the other mortgage, if so is there a way around this??

This may seem pedantic, but there is a difference between borrowing money (a mortgage) and owning a property (name recorded on the Title).

Usually, mortgage lenders require the borrower to own the property - but not always.

If your name is on the mortgage, but not on the Title, you will not be a 2nd property owner so the higher rate of stamp duty will not apply (though you'll struggle to get a 2nd mortgage).

If however you own the property (name on Title) then the higher rate of stamp duty will apply.