Remortgage on Half a House

Garyw001

Hello & Help,
After my parents died my sibling & I inherited their house which was owned outright and they wanted to split the house evenly between their two children.
 I have my own house with a mortgage which I live in with my young family. My sibling lives in the inherited house alone.
Now that the probate of our parents Will has concluded, both my sibling & myself have our names on the title deeds of the property.
This is where it gets tricky.

My sibling does not want to sell the house and wants to continue living there. It was redecorated to their own particular taste and it, in my eyes doesn’t resemble my parents house anymore so now, unfortunately, I have no emotional attachment to it even though I grew up on it, it is not what it once was. Ideally it would be nice for my sibling to buy me out of my 50% share of the house which would result in me paying off the mortgage to my family home and with money left over. Basically it would be a life changing event for my family & I to live life mortgage free and not have the financial constraints of a mortgage.

This is not going to happen.

My sibling can not get a mortgage due to little or no credit rating nor has the ability to pay a mortgage whilst living alone which is expensive. I’m not going to instigate a sale of the house and force them out so we have come to an agreement which benefits my sibling more than myself. To live in my 50% share of the house rent will be payed, not at current market value, more like a quarter. I came to that monthly rental fee as it is 50% what I pay mortgage per month on my family home. My sibling & I have got a “Deed of Trust” which covers the rent payment but I’m still going to be an unwanted landlord and not really benefiting from the agreement. It also brings additional problems as this rent will have to be declared as “Additional Earnings” and is taxable. It will push me into the “Higher Income” tax bracket so in real terms I will be worse off financially and it has caused friction with my spouse & I. By helping out my sibling I am damaging my own family’s welfare. 

My current mortgage deal ends soon and what I would like to do is with my 50% of the inherited house is to remortgage it with lengthy “buy to let” deal thus paying off my mortgage to my family home and the rental payments would pay the “Buy to Let” mortgage. It also offsets the income tax issue as no profit is made due to all rental payments are paying off the mortgage.

What I’d like to know is;
Is this plan possible with a shared property ownership? Would banks or mortgage brokers even look at this type of scenario?

Any other ideas on what other action I can take with looking after a sibling without compromising my own family’s needs & welfare. 

Thanks in advance

davidmcn

No, you can't mortgage half a house. How would the lender repossess it?

csgohan4

money and family shouldn't mix, best to sell the house and split the proceeds and let them do what they want with their share.

Trying to prop them up by keeping the house will only end in tears. Unless your a charity I wouldn't. 

DCFC79

davidmcn said:

No, you can't mortgage half a house. How would the lender repossess it?

Maybe saw it in half, secure it and drag it away.
Both parties win, the sibling gets to live in the property and the lender gets the other half.
😉

Thrugelmir

Sell the property to your sibling using a private mortgage arrangement. Then whatever your sibling can afford to pay you could be split into part capital repayment and part interest.