Daughter and her boyfriend buying a house

KateT56

Hi all. I am after a bit of info about mortgages and pitfalls thereof. My daughter and her boyfriend are planning in buying a house next year. They have got the first time buyers guide and are working on the advice in there. The bf has money for a deposit and with a top up from his parents can afford up to 120k based on his earnings. My daughter will just be finishing university and will have no income at the time they buy. They want both names on the mortgage and I was just wondering what the pros and cons of that were. I am also unsure on what basis his parents are loaning money- I know it is to be paid back. What questions do we need to ask to protect my daughters interests?
Thank you, Kate

davidmcn

It's unlikely a mortgage lender would accept the deposit being borrowed from parents, they generally insist on it being a no-strings-attached gift. 

Stenwold

What interests?

Your daughter is going to be a homeowner and joint mortgage holder without contributing anything to the deposit, or the monthly cost of living there (for the time being, at least). Your daughter will have joint liability of the mortgage payments if things turn sour, but it sounds as though the boyfriend has more to lose so it's unlikely he will let the mortgage go unpaid.

In terms of the loan back to his parents - his lender would have asked the same question and would have been happy with the answer e.g. it will be paid back with manageable monthly payments, or it was a gift and it won't need to be paid back.

elsien

Yes, I was wondering what interest in the property she would have at this stage if she's putting nothing in. 
Would they not be better off waiting to buy until she has a job and can contribute, then it would make more sense for her name to be on the mortgage etc.
They also need to consider the implications of how he is going to protect his deposit, if they do split up, but also the gift from his family if she is helping to pay that back. They may want to consider a deed of trust to cover all the eventualities.