Please help mortgage transfer

Eucalyptus84

Hi,

Any advice would be most welcome!

My sister is breaking up with her partner of nearly 10 years and last year they bought a property together.

She would like to stay in the property and transfer the mortgage into her own name. So far the break up has been fairly amicable and her partner has agreed to have his name taken off the mortgage in return for a small payment (£2,000) to see him on his way. They have discussed this and he is happy to put it in writing.

She contacted her mortgage company (TSB) who have said that they cannot give her a certain mortgage offer (either confirming or denying her a deal) before she has placed all of her savings into the mortgage.

Her solicitor has STRONGLY advised her against placing her savings into her mortgage before recieving an offer from TSB. On the off chance that things turn sour in the break up, her large payment into the mortgage (to reduce the overall amount but also including overpayment fees) could count against her and the partner could end up with a portion of her money.

The underwriter has confirmed that the loan is affordable but TSB have still refused to give a concrete offer. She's getting near the point of desperation and is now saying she is going to place all of her savings into the mortgage and hope for the best.

She would remortgage and switch provider but there is an additional £8,000 fee for switching providers. TSB have said that if she doesn't want to put her savings into the mortgage she can swtich providers (£8,000) or wait for their rules to change which apparently they will... at some unknown date in the future.

Overall I feel that TSB is treating her very unfairly in a particularly distressing point in her life and with the solicitor telling her to insist on a mortgage offer BEFORE placing her saivngs into the mortgage she is going around in circles and getting desperate.

I would like to know if there is any legal precedent which might force TSB to at least confirm they would offer her a mortgage if she placed her life savings into the mortgage?

Any other useful advice would also be very welcome indeed.

Thanks in advance!

Number75

So - does she not earn enough to take over the mortgage in her name only, so TSB have suggested that she overpay the mortgage so that she passes the affordability calculation for her income alone?

I personally wouldn't be happy with 'losing' my savings that way as I like to keep a safety net.

I don't think the problem of her boyfriend getting more of the money later is insurmountable. Can't they use the solicitor to sever the joint tenancy (if that's what they are) into tenants in common and reflect the % split around the money she puts in?

If they're not married, that would be quite simple I think.

Can her ex boyfriend wait out the fixed rate period with the the high repayment charge? So she gives him £2K now, and pays the mortgage hereafter but doesn't take it over until they are out of the ERC period? Would probably stop him from buying - but if he's not planning to, could be an option. Would need to be sewn up with a solicitor though - e.g. How much of any equity increase he would then get.

Eucalyptus84

Hi Number75,

Thanks for your reply.

She doesn't earn enough for them to simply transfer the mortgage over to her unfortunately and she doesn't want to use her savings like this either but I think she feels backed into a corner.

They're not married I'll have to check if they're currently joint tenants, but I would assume they are. When you say reflect the % split around the money she puts in do you mean she buys him out based on how much money he has put in? I don't think he put anything in for the deposit when purchasing the property as she sold her previous flat which gave them a deposit.

Again, I'll have to check but I suspect they may be on a 5 year fixed rate. Whilst things are amicable now I know that given the choice he wouldn't have chosen to part ways so if she were to start dating a year from now and he decided to be difficult because of that or any other reason - well lets just say I can understand why she would like him off the morgage agreement sooner rather than later. I don't think keeping his name on it and have her paying it is an option.

Thanks again for the suggestions - I will see if she thinks any of them are viable options.

Eucalyptus84

I've checked with her and she says that they've already made themselves tenants in common but the mortgage lender still won't give a mortgage agreement or consent until after she puts her savings into the mortgage.

Eucalyptus84

Update: Sadly, after weeks of stringing her along, TSB have now told my sister that she will HAVE to remortgage with another lender which will cost her £8,000 as well as the other fees associated with setting up a new mortgage and paying the previous one off early.

I strongly urge everyone NOT to use TSB for any services after this terrible experience. They clearly aren't set up to cope with situations where common sense and putting the customer first might be a priority.

Eucalyptus84

Update on this update - my sister managed to get in touch with CEO of TSB who was shocked and appalled at the way she had been treated and referred her to customer services. Her case was re-examined and watched from every angle by different departments within the company and surprise surprise they found that she COULD afford the mortgage on her own and approved her case.

She now (is considerably poorer) and has her name only on her mortgage and can start to move on with her life. I felt it fair to update that TSB did come right in the end.