Paying off someone else's mortgage...pitfalls?

Finchy2018

Even with a substantial deposit our mortgage payments seem like they'd be very expensive more than rent. We'd move to a cheaper area but due to family members with life limiting illnesses we just need to be close to them at the moment. Plus I intend to take a year off work, which I guess would affect my chances of getting a mortgage.

All food for thought though. Thanks

AnotherJoe

If you still wish to pay off their mortgage it would be better to do it as an open ended loan they don’t need to repay until the house is sold. Have that drawn up as a legal document.

Otherwise a possible scenario is, you give them this large sum of money, they pay off mortgage and then possibly just, a few months later they go into care,and the council sells the house and uses the whole proceeds to finance that. Better that you ring fence your money to achieve the aim of ensuring your relative is able to live in the house but without you effectively giving your money to the council

csgohan4

money and family shouldn't mix


Unless you don't expect the money back, don't do it.

tlc678910

Hi,
It's very kind of you to consider this.
Perhaps as the person probably gets benefits (as you say they are unable to work) if you go ahead you could try to settle the mortgage directly without the money ever going into their account if possible, so it doesn't affect means tested benefits. If you can do this I'm guessing the mortgage lender or solicitor would need to check the source of your funds for money laundering.

I agree with the other poster that you could explore putting a charge against the house so you could be repaid if your relative chooses to sell or is forced to sell.

Tlc

silvercar

AnotherJoe wrote: »

If you still wish to pay off their mortgage it would be better to do it as an open ended loan they don’t need to repay until the house is sold. Have that drawn up as a legal document.

Otherwise a possible scenario is, you give them this large sum of money, they pay off mortgage and then possibly just, a few months later they go into care,and the council sells the house and uses the whole proceeds to finance that. Better that you ring fence your money to achieve the aim of ensuring your relative is able to live in the house but without you effectively giving your money to the council

I agree with this.

Also the risk that you pay this money and then the recipient falls under a bus the next day and the money has been wasted.