Paying Parents Mortgage - Struggling to get new home with partner

AdrianC

goodwithsaving wrote: »

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

The OP isn't just "paying" - they're a co-owner. So that portion of the property isn't the mother's in the first place. Depending on how it's owned, there may be nothing at all to inherit.

FBaby

What terms were discussed when you agreed not only to have your name on the mortgage but also pay all of it? If your parents are on a low income, they should be receive quite a bit of tax credits on account of your siblings, and that would go towards paying the mortgage. It seems very unfair that they shouldn't contribute a penny, especially when you're not even the sole owner.

Also, you surely discussed the future and what would happen when you met someone and wanted to move on? Or were you expected and willing to pay until the full mortgage was paid?

Unfortunately, it comes down to you vs them and who should make the sacrifice of not having the accommodation they are aspiring to.

exiled_red

Person_one wrote: »

The OP mentions Milton Keynes, perhaps this means they want to be in commuting distance of London? If they're paying rent in the SE, plus a mortgage on a property in the SE, that's a substantial amount every month before any living costs, pension, etc.

That's why I am asking how much the mortgage and rent etc are and what the OP's major outgoings are. The income of the OP and their partner seems fairly large but obviously it depends on the outgoings, which may be able to be reduced in some way. For example I assume the OP's parent's mortgage isn't on the best deal given their financial situation if the OP isn't on the mortgage.

moneyistooshorttomention

FBaby wrote: »

What terms were discussed when you agreed not only to have your name on the mortgage but also pay all of it? If your parents are on a low income, they should be receive quite a bit of tax credits on account of your siblings, and that would go towards paying the mortgage. It seems very unfair that they shouldn't contribute a penny, especially when you're not even the sole owner.

Also, you surely discussed the future and what would happen when you met someone and wanted to move on? Or were you expected and willing to pay until the full mortgage was paid?

Unfortunately, it comes down to you vs them and who should make the sacrifice of not having the accommodation they are aspiring to.

Agree with this post.

Your money.
Their housing need.

Your parents should have thought this through before agreeing to your kind offer. As they are the ones in a difficult situation - then it's up to them to solve their problem (ie them finding a way to get your name off their mortgage and pay you back the money they owe you).

acouplefrommk

Thank you all for taking the time to respond. After reading through the thread, I noticed that a common question was to know more on our financial situation and agreement options with my parents. I kept my initial post quite vague as it wasn't what I wanted to discuss - The reason for stating my salary was that certain help-to-buy options such as shared ownership have their own criteria (max income £80,000 p/a etc.), but requires either being a new home buyer or previously having a home. I wanted to elaborate a bit more on this.

Understandably, I am aware of what the initial reaction would be after reading my post and our salary ranges, however wether I am on £20k or £50k is all down to affordability, thus the affordability assessments from mortgage lenders. To shed some light, we are both living in Milton Keynes where the average rent of a 1 bedroom apartment in a commutable area goes for £700 p/m. I commute to London for work each day via the bus/train. My partner commutes to Nottingham daily via the car which after a few weeks, requires more servicing, high diesel costs. Additionally moving jobs isn't as easy for her due to certain contractual agreements. The main thing to note is that although the overall income is high, the tax is also reflecting on this. Without breaking down into our exact outgoings which myself and my partner have already reviewed, there are many who are on a lower income to ours that have a better affordability situation than we do, there are even those who are earning more than us with an even lower affordability option.

Regarding my parents, I wont deny that resentment has developed over time for them to not have a plan about this and with that, subconsciously come to the conclusion that they have become our dependants. Completely understand and agree with some of your views on my situation, I myself have gone through the same thoughts, however I either let them sink or carry on with the way it has been for the past few years. Dad helps out where possible on part time roles, mum is full time and both don't claim any government support or contribute to the mortgage. I am not helping to bypass anything related with tax or inheritance, solely just to help. Being relatively young when I helped out, there was a naivety on my behalf on how this could affect me in the future and now that stage has come, it's difficult for me to just drop the whole thing.

Reading through some of the options, I will have to consider downsizing them if it is going to result in my prospective future, however what I wanted to know was wether there is a feasible option at all to apply for any of the help to buy schemes which I seemingly still qualify for with the exception of the mortgage I really should not have taken on.

Pixie5740

acouplefrommk wrote: »

Reading through some of the options, I will have to consider downsizing them if it is going to result in my prospective future, however what I wanted to know was wether there is a feasible option at all to apply for any of the help to buy schemes which I seemingly still qualify for with the exception of the mortgage I really should not have taken on.

No, you are not eligible for a HTB ISA (although your partner might be if she has never owned property before) and you are not going to be eligible for HTB EL either whilst you own a property with your mother. Owning the property with your mother will also exclude you from shared ownership.

You helping your parents has resulted in you shafting yourself. Downsizing will only help you if it means that you will no longer jointly own property with your parents otherwise you still won't be eligible for the HTB schemes, the mortgage will still impact your affordability to get another mortgage and you will still have to pay the additional 3% SDLT.

If you parents can't get a mortgage and can't afford to buy somewhere outright after selling the current property then they will need to look at renting and seeing what benefits (https://www.turn2us.org.uk) they will be eligible for including housing benefit. It's all very well and good your parents not relying on benefits but not when it involves sponging off their children instead.

AdrianC

acouplefrommk wrote: »

After reading through the thread, I noticed that a common question was to know more on our financial situation and agreement options with my parents.

In the context of your question, they are very relevant.

Understandably, I am aware of what the initial reaction would be after reading my post and our salary ranges, however wether I am on £20k or £50k is all down to affordability, thus the affordability assessments from mortgage lenders. To shed some light, we are both living in Milton Keynes where the average rent of a 1 bedroom apartment in a commutable area goes for £700 p/m.

OK... And you're earning about £3,300 per month after tax, and your partner is earning about £1,300 - so that rent is about 15% of your after-tax income.

I commute to London for work each day via the bus/train

Rail season ticket is £5k/year, or just over £400/mo.

My partner commutes to Nottingham daily via the car which after a few weeks, requires more servicing, high diesel costs. Additionally moving jobs isn't as easy for her due to certain contractual agreements.

160 miles/day, 35k/year. At only 25p/mile, after all car costs are taken into account, 56% of her after-tax income is going on just getting to work and back...

Let's be frank, here. She's earning 2/3 of the national average salary - this is not going to be some golden handcuffs contract. This makes absolutely zero sense - and that's before we consider quality of life. How many hours a day between her leaving the house in a morning and getting back in the evening...?

Without breaking down into our exact outgoings which myself and my partner have already reviewed, there are many who are on a lower income to ours that have a better affordability situation than we do, there are even those who are earning more than us with an even lower affordability option.

You are going to need to explain more. You don't have to go into absolute detail, but you are earning £4,600/mo after tax - even if you include your high commuting costs, you have well over £3k in hand every month coming in, between you - yet you seem to be complaining that £700/mo rent is not affordable. In rough numbers, your other half's salary is going entirely on commuting costs for the pair of you, leaving yours entirely available for the rest of your lives.

what I wanted to know was wether there is a feasible option at all to apply for any of the help to buy schemes which I seemingly still qualify for with the exception of the mortgage I really should not have taken on.

You sound like you still need to understand that you are not just "on the mortgage" - you are a joint owner with your mother of the house your parents live in.

xylophone

I think that you are going to have to explain to your parents that you and your girlfriend want to buy a house together and that you are unwilling to continue with the present arrangement.

Is your father unable to obtain to obtain full time employment for some specific reason?

If the house were sold, what could they realistically afford to buy?

steampowered

It sounds like you are paying rent on your own property as well as on your parents, reasonably near to London, as well as paying 40% tax on much of your income. After all that you won't be rolling in cash!

Some of the other posters have been quite harsh on your family arrangements, but we have no idea at all what your family circumstances are, and I am sure you don't want to kick out your teenage siblings. I certainly wouldn't.

One point noone has mentioned - if you are legally required to pay towards your parents' mortgage, surely that would be taken into account when lenders assess affordability?

It sounds like the best solution would be for your parents to get a mortgage in their own names. You could still send them money to cover payments. If that isn't possible, I am struggling to see how you could afford to buy a property.

ViolaLass

You could also try suggesting to your girlfriend that she find a means of earning more than one quarter of your joint salaries.