Reasonable amount to remove name of a mortgage?

Bigsmokeuk

Me and my friend bought a house together in 2007 and I reckon it's now in negative equity as it was a interest only mortgage, it's probably about £5-10k in negative equity so therefore, if one of us took on the loan and remortgaged there's no equity to split and pay the other off.

If I was too look at taking on the mortgage and doing a Remortgage and changing it into repayment the reality is I would be taking on the debt (negative equity), would it be fair for me to ask my friend to take their name off the mortgage for nothing?

He's invested as much as me in the property over the years but hasn't lived in it for about 5 years, I wouldn't like him to walk away with nothing but at the same time there's no equity to buy him out and nothing has been paid off the mortgage as it's interest only.

So whats a reasonable figure to ask him to take his name off the mortgage? Or what way would you anybody in here suggest going about it.

ACG

How much did he put down as a deposit?

foxy-stoat

You will probably find that in order to take out a new repayment mortgage you will have to fund the negative equity plus legal fees plus 5-10% deposit on the market value in cash.

Best you talk to your friend about it and see what they are thinking about the value.

https://forums.moneysavingexpert.com/discussion/5924277/help-change-name-on-mortgage-and-remortgage

Have you found a broker or lender and checked the affordability?

Bigsmokeuk

Neither of us put down a deposit, I will be speaking to a financial advisor at some point next week.

I will speak to my friend and see what he says, just wouldn't be worth my while trying to add more like £10k if thats what he wanted.

ACG

If he is not living in the property and has no intentions of doing, he will probably be quite happy for you to pay the legal fees to take his name off it. I would be.

foxy-stoat

Bigsmokeuk wrote: »

Neither of us put down a deposit, I will be speaking to a financial advisor at some point next week.

I will speak to my friend and see what he says, just wouldn't be worth my while trying to add more like £10k if thats what he wanted.

So you have a 100% mortgage 11 years ago and its dropped in value by £5,000-£10,000....not sure why you would want to owe it outright and take the hit all on your own.

Bigsmokeuk

Yes my friend is now married and living with his wife and child in another house, the reason why I'd want to do it is I like the house and where it is and my wife wants to go on the mortgage with me.

The house hasn't really went into to negative equity it was worth £93k when we bought it and me and my mate borrowed £10k to do it up, so the mortgage is £103k and houses in the same street have been selling in and around £90-£95k ours is a end semi detached so it's a bigger property around it so I'm hoping when valued it would be around £95k

Caz3121

Bigsmokeuk wrote: »

I'm hoping when valued it would be around £95k

how much is the outstanding mortgage amount?

Bigsmokeuk

Still £103k it was a interest only mortgage over 25 years

Thrugelmir

Agree with your friend that you'll start paying down the mortgage and once in positive equity will remortgage. Document the agreement.

foxy-stoat

You still need to find £17,500 cash plus legal fees, assuming your mate will sign the property over to you....assuming you want to pay £103,000 for a property that is worth £95,000.

Or you can pitch it to you mate that you need to pay £300 each every month for the next 14 years in order to clear the mortgage when it expires....and sort out a payment for living in his property rent free for the next 14 years !