Paying Parents Mortgage - Struggling to get new home with partner

acouplefrommk

I'm writing this post to try and seek some advice on your own experiences or opinions, as I currently feel quite stuck on options to move forward with.

To summarise my situation, I'm currently on my parents mortgage as a joint application with my mum but am solely paying this for the past 8 years to help as their income is relatively low. Not living with parents but renting with my girlfriend and with both of us close to hitting 30, we're wanting to progress to the next steps, considering a family, establishing our foot in the ladder and with that, would rather have a mortgage/asset of some sort together.

I'm currently earning £55000 basic and my partner £17900, with that, our combined income rules us out of applying for help-to-buy schemes or shared ownership options together let alone with my name already on my parents mortgage. Most of our income after paying the essential bills is taken away on work related costs or maintenance of the car so it doesn't leave us with much options for saving.

I've considered releasing equity in the existing mortgage to help contribute to a deposit for us by £20000, but that would still only contribute towards a 5% - 10% for a worn down 1 - 2 bed home in Milton Keynes as my stamp duty would be very high due to it being classed as purchasing a second property.

Another passing inkling was wether it would be an advisable option for me to remove my name off my parents mortgage but still send them money to cover this? Would this legally allow me to solely apply for help-to-buy schemes or shared ownerships?

We were wanting to understand if we're indeed quite stuck on saving the conventional way, or if there are any alternative routes or 'loopholes' that could help us get on the ladder without waiting another 5 - 10 years for a moderately saved deposit.

Thank you for taking the time to read my post, any help would be greatly appreciated.

Mrs_pbradley936

Well you cannot have two properties without paying for both of them! Plus if you buy an additional property and you already have one and are not selling it ( I take you parents are not moving) you may also have additional stamp duty to pay.

You need to decide if you can continue to support your parents, 8 years is hardly short term. It would be easier all round to sell your parents place and let them buy somewhere without your assistance. Then you will be free to sort yourself out.

Pixie5740

How likely is it that your mum or both parents could get a mortgage in their names allowing you to close the mortgage account you currently have with your mum?

How much has the property you own increased in value since you bought it? As it's not your main residence CGT might be due when you dispose of the asset.

ViolaLass

Can your parents downsize?

acouplefrommk

Unfortunately my parents aren't in a position to downsize on their own as their low income is spent on looking after my 2 teenage siblings who still live there.

The property is a 3 bedroom valued at £180,000 and currently outstanding of £128,000. Selling the property to downsize even for a 2 bed in the current market would still go for a price that wouldn't make it worthwhile after considering legal cost and other expenses.

Pixie5740

So if they can't/won't downsize can they get a mortgage without you being named on it?

AdrianC

acouplefrommk wrote: »

To summarise my situation, I'm currently on my parents mortgage as a joint application with my mum

So you and your mother jointly own the property.

I'm currently earning £55000 basic and my partner £17900, with that, our combined income rules us out of applying for help-to-buy schemes or shared ownership options

Frankly, good. With an income between you of nearly £75k, you don't need help from housing associations or the taxpayer to stand on your own two feet.

Most of our income after paying the essential bills is taken away on work related costs

You're self-employed? If so, then that isn't your income. Your income is what's left after you've paid your business costs.

or maintenance of the car

Get a cheaper car, then.

so it doesn't leave us with much options for saving.

You earn nearly three times the national household average income, yet you don't have "options for saving". <boggle>

I've considered releasing equity in the existing mortgage to help contribute to a deposit for us

And what does your co-owner think to that?

my stamp duty would be very high due to it being classed as purchasing a second property.

You own one property now. You would own two. That sounds a lot like purchasing a second property to me, yep.

Another passing inkling was wether it would be an advisable option for me to remove my name off my parents mortgage

Can they get a mortgage in their own names?

We were wanting to understand if we're indeed quite stuck on saving the conventional way, or if there are any alternative routes or 'loopholes' that could help us get on the ladder without waiting another 5 - 10 years for a moderately saved deposit.

I don't think you're going to get the sympathy you're looking for.

xylophone

Does your father have no income at all?

Person_one

Why are you on the mortgage for your parents' house? Was it done to help them out financially or a way to avoid inheritance tax?

It will be difficult, you can't rid yourself of the house you don't really want to own because its home to the rest of your family, so realistically you're just going to have save harder and longer and to buy a house to actually live in yourself.

goodwithsaving

You're paying for your parent's house. Will you be repaid eventually or would your siblings receive equal inheritance? Something to consider

gettingtheresometime

Are they claiming all the benefits that they are entitled to?

If they've basically been living rent free for the last 8 years I think it's time for some straight talking to them. It may even be better for them to sell up and rent somewhere, if their level of income allowed them to claim HB.

When you came up with the idea to take out a mortgage with your mum, did you discuss what would happen when you wanted a home of your own?

With your level of income, I'd be gobsmacked if there was any schemes to help you.