Supporting parent in mortgage application / property acquisition.

JxB

She's in the process of getting new state pension statement....should have the info this week (couldnt be done onliendue to recent change of name).

No pension contributions at the moment - she's about to change jobs so we'll look at it then but at the moment she's only £500ish over the tax-free allowance, so the gains to pension contributions are negligible

JxB

Yeah, I was thinking equity release. Thanks so much for all the useful info, will be looking to go down this route. Cheers.

sheramber

JxB wrote: »

Thanks AnotherJoe, looks like that might be the solution.

Do you know how the mortgage lenders assessed the second charge? Its looking like mum's going to put up 20-30k, I'll put up 20-30k and then she'll have a sole mortgage for around 70k. But this only works if the lender agrees to treat the second charge loan essentially the same as a cash deposit on the affordability assessment. Did you run into any issues on this?

Also, with the second charge does this mean you have to get involved every time there is a re-mortgage / product switch?


And finally, would mum be blocked from taking out a first charge mortgage that effectively kills my 2nd charge... just dont want to get down the road and find she's accidentally had a first charge taken for the entire value of the house and I have nil recoverable on sale


Thanks for the tips guys!

Would your mother get a mortgage for 70k when she earns 12,000 or 18,000?

xylophone

No pension contributions at the moment - she's about to change jobs so we'll look at it then but at the moment she's only £500ish over the tax-free allowance, so the gains to pension contributions are negligible

She could be in the new job for a number of years- she will benefit from an employer's contribution as well as her own and from tax relief.

Does she really want to turn down free money?

JxB

At 12-18k the concern is the affordability assessment - it!!!8217;s looking like that!!!8217;s ok when the deposits high enough (as it reduces monthly payments) - that!!!8217;s why she needs the support on the deposit.

Re pensions agreed it!!!8217;s worth doing once over 12k and has cash reserves in September . Right now the hit on cash in hand isn!!!8217;t worth it.