Buying out Brother..

Spursman100

Hello


Myself and my brother own a 50%-50% stake in a flat,. I moved out 3 years ago and he continued to pay the mortgage.


He now wants to move to a new house but can only afford to raise a deposit by selling the flat we own. I don't want to sell as I want to rent it out as an investment.


We paid £160k
Estate Agent has said its worth £290k
We owe £122K


So we have got £168k of equity in the property. Divided by 2 is £84k


So to enable me to buy him out I just need to give him 84k and get a solicitor to take his name off the deeds?


Is that the correct procedure?


as an added extra, the lease is only 68 years and we have a bankrupt and absent landlord. We have put in an offer of £10k to buy the freehold with the neighbour upstairs. We don't know if we can get it for this amount.


estate agent said its worth £290-300 without extending lease and £325k with extended lease.

foxy-stoat

Spursman100 wrote: »

So to enable me to buy him out I just need to give him 84k and get a solicitor to take his name off the deeds?
Is that the correct procedure?

Your forgetting to inquire with your lender to see if they will agree to remove his name from the mortgage - you will probably have to take out a new mortgage in your sole name though.

Spursman100

foxy-stoat wrote: »

Your forgetting to inquire with your lender to see if they will agree to remove his name from the mortgage - you will probably have to take out a new mortgage in your sole name though.

Thanks, didn't realise that. Will they offer me a new mortgage based on a 68 year lease?

Henry46

[FONT=Verdana, sans-serif]You also need to check that you buying the other 50% does not set the statutory 2 year ownership for a lease extension back to zero.[/FONT]
[FONT=Verdana, sans-serif]It would if you were adding another owner, but I don't know if it would apply to you but you will not have owned the whole property for two years.[/FONT]

Spursman100

Henry46 wrote: »

[FONT=Verdana, sans-serif]You also need to check that you buying the other 50% does not set the statutory 2 year ownership for a lease extension back to zero.[/FONT]
[FONT=Verdana, sans-serif]It would if you were adding another owner, but I don't know if it would apply to you but you will not have owned the whole property for two years.[/FONT]

Its a maisonette so the are only two property owners. The landlord is absent and bankrupt and we have owned the property for over 10 years.


We are in the process of buying the freehold which doesn't matter how long you have owned it for.