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Advice Sought
Xenicus
Posts: 3 Newbie
Hello
I’m in a situation where myself and my ex own two properties (one we live in joint-tenants and one BTL tenants-in-common) and, at the same time as my ex is buying me out (with me moving into rented accommodation for a year or so) we need to remortgage the BTL, which we are keeping as a business concern (the split is amicable).
I will receive about 150k from the buyout. I’ve two options to help make this money work for me;
1) Effectively pay off my half of the interest only mortgage on the BTL (approx 90k), with me no longer contributing to the mortgage - with a trust deed put in place that protects me from my ex defaulting or passing away as the mortgage company would still continue to see us jointly liable, and I suspect on death without a deed in place, assume that I am responsible for half the mortgage debt. When I need the money back i can either do additional borrowing or remortgage. With this option I continue to own 50% but all my share is equity.
2) Agree on a value and then increase my share to 60%, reducing my ex’s share to 40%, but being responsible for the mortgage debt and repayments 50:50. This option requires less investment on my part, but complicated rent & maintenance calculations. Is there stamp duty involved? What happens on death is covered by standard law so a trust deed is only needed to cover who can force a sale and when. With this option I own 60% so over time is more profitable than option 1 in my calculation, although option 1 is my current preference, although I am not sure why.
Anyone got any advice and does anyone know if I can be sufficiently protected by a trust deed with option 1?
Leo
I’m in a situation where myself and my ex own two properties (one we live in joint-tenants and one BTL tenants-in-common) and, at the same time as my ex is buying me out (with me moving into rented accommodation for a year or so) we need to remortgage the BTL, which we are keeping as a business concern (the split is amicable).
I will receive about 150k from the buyout. I’ve two options to help make this money work for me;
1) Effectively pay off my half of the interest only mortgage on the BTL (approx 90k), with me no longer contributing to the mortgage - with a trust deed put in place that protects me from my ex defaulting or passing away as the mortgage company would still continue to see us jointly liable, and I suspect on death without a deed in place, assume that I am responsible for half the mortgage debt. When I need the money back i can either do additional borrowing or remortgage. With this option I continue to own 50% but all my share is equity.
2) Agree on a value and then increase my share to 60%, reducing my ex’s share to 40%, but being responsible for the mortgage debt and repayments 50:50. This option requires less investment on my part, but complicated rent & maintenance calculations. Is there stamp duty involved? What happens on death is covered by standard law so a trust deed is only needed to cover who can force a sale and when. With this option I own 60% so over time is more profitable than option 1 in my calculation, although option 1 is my current preference, although I am not sure why.
Anyone got any advice and does anyone know if I can be sufficiently protected by a trust deed with option 1?
Leo
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