Buying out half share

D_J

Evening all,

My partner and her brother inherited a property, he wants to stay there and him and his partner want to buy out my partner...

We heard today they want a solicitor to draft up a contract which will be presented to the bank for a remortgage stating that my partner will sign over her half of the property once payment is received, is this even possible?

00ec25

rather depends if your partner wants to sell and will therefore sign the contract


what is you actual question?
- she does not want to sell?
- she objects to the costs of a formal contract?
- she objects to the people involved?
- you don't believe they can get a mortgage until after she has sold (signed over)?
- you refer to re-mortgage, does that mean she is party to an existing mortgage and will not be party to any re-mortgage?

Slithery

D_J wrote: »

My partner and her brother inherited a property, he wants to stay there and him and his partner want to buy out my partner...

Is the deceased's estate still in probate or has the property ownership already been transferred to the two siblings?

D_J

My apologies...

She wants to sell, the plan has always been they will buy my partner out.

The house now belongs to them both, the probate was settled a while back.

I dont think they’ll get the mortgage personally, but they want to get a contract that states the property will be signed over once payment is sorted. However in order to get the money they want to remortgage half of the property (my partners half)...

I’m trying to explain it the best I can, hope you can understand what I mean

G_M

They can't 'remortgage half of the property'. They will need to pay off any existing mortgage and apply for a new mortgage, for the full amount they need, in their joint names.

As this is what happens every single day when 95% of house sales go through, it's pretty standard.

The seller signs a contract to sell with vacant possession.
The seller's solicitor gives 'a solicitor's undertaking' to remove the existing Charge (mortgage) on receipt of the purchase money.
The mortgage lender sends the money to the buyer's solicitor.
On the day of Completion, the buyers solcitor sends the money to the seller's solicitor.
The seller's solicitor gives the buyer's solicitor signed form TR1 (to register the purchase)
The seller's solicitor pays off the mortgage and the Charge (old mortgage) is removed.
The buyer's solicitor, acting also for the lender, registers the new Charge (mortgage) against the property.

Tom99

D_J wrote: »

Evening all,

My partner and her brother inherited a property, he wants to stay there and him and his partner want to buy out my partner...

We heard today they want a solicitor to draft up a contract which will be presented to the bank for a remortgage stating that my partner will sign over her half of the property once payment is received, is this even possible?

I doubt the bank would need a signed contract to offer a mortgage so you could leave the contract side of things for now until you know whether brother will be offered mortgage.
What are you going to do if brother cannot get a mortgage? Charge rent for the half he does not own? Or lend him money to complete the transfer? Both would have the significant downside of no real fixed end date.

GDB2222

The brother wants a formal option contract to buy his sister out, providing he gets finance. That seems okay in principle, but rather rare. It’s more common with developers, who want an option to buy if they get planning permission.

The option should have a reasonable time period, like 3-6 months, ie long enough to sort finance out, and then it lapses automatically if the sale has not gone through.

The brother will only get a finance offer prior to the sale. The remortgage takes place at the point that sister actually sells her half share and gets paid out.

davidmcn

GDB2222 wrote: »

The brother wants a formal option contract to buy his sister out, providing he gets finance. That seems okay in principle, but rather rare.

It seems a bit odd, given it's hardly likely that the sister can do anything else with her share in the meantime.

GDB2222

davidmcn wrote: »

It seems a bit odd, given it's hardly likely that the sister can do anything else with her share in the meantime.

It's certainly strange that it's a pre-condition of a mortgage offer. But, the OP didn't ask whether it's strange, or even wise, he just asked whether it's legal, which it is.