Can a LISA be used to buy into an existing mortgage

sugasphinx

Hi, I've been trying to find the answer to the above online, but with no joy. Basically, if my parents wanted to remortgage and add me to the mortgage at the same time (I've never owned a house/been on a mortgage before), could I use my LISA plus bonus for this purpose? 
Any help would be appreciated

eskbanker

You'd need to go through a properly-conveyanced sale/purchase process to be added to the title deeds, rather than simply remortgaging, but provided the purchase otherwise complies with the scheme rules (value threshold, etc) then it should be possible, although it sounds like an unusual arrangement....

Fighter1986

There's not really any such thing as simply "being added to the mortgage".

If your intention is to become joint owner with your parents and all three of you to own the house they would need to agree to you becoming a jointly and severally liable owner of the house with them and you would all three need to apply for a mortgage jointly to complete the transfer of ownership (sale / purchase). You would all three become financially associated and jointly asessed by mortage underwriters - you would need sufficient income to support your share of the mortgage and you would need to be resident in the house.

I think there might be a little more to this than you initially expected, I think it would be best for all three of you to speak to a mortgage broker to discuss your requirements and options.

If it's something you three want to go ahead with having fully understood the undertakings and are successful, then yes, the LISA could be used to fund part of your purchase of your portion of the house. 

sugasphinx

Thanks both I understand it's not just adding my name to a bit of paper. I just wasn't sure if the LISA could be applied since the house wasn't going to be "for sale" beforehand.

bowlhead99

sugasphinx said:

 I just wasn't sure if the LISA could be applied since the house wasn't going to be "for sale" beforehand.

It will be 'for sale' to you, and you will be buying a share of the property with your cash and by taking on responsibility for a mortgage. It doesn't have to be 'for sale' to the general public, - presumably your parents aren't going to let just anyone buy a piece of their house that they'll be still owning.

Morrigan_2020

Be absolutely certain this is what you want to use your one and only LISA bonus on, will you never want to own a house that isn't also your parents?

Alexland

Morrigan_2020 said:

Be absolutely certain this is what you want to use your one and only LISA bonus on

Well technically you can keep getting bonuses on contributions made until age 50 but you only have one opportunity to use it to support a penalty free qualifying property purchase. We are still earning bonuses despite being homeowners and the money will be used for our kids deposits and other things after age 60.

Morrigan_2020

Alexland said:

Morrigan_2020 said:

Be absolutely certain this is what you want to use your one and only LISA bonus on

Well technically you can keep getting bonuses on contributions made until age 50 but you only have one opportunity to use it to support a penalty free qualifying property purchase. We are still earning bonuses despite being homeowners and the money will be used for our kids deposits and other things after age 60.

Yes I should have been clearer, there's only one opportunity to put it towards a property before the age of 60. 

masonic

Morrigan_2020 said:

Alexland said:

Morrigan_2020 said:

Be absolutely certain this is what you want to use your one and only LISA bonus on

Well technically you can keep getting bonuses on contributions made until age 50 but you only have one opportunity to use it to support a penalty free qualifying property purchase. We are still earning bonuses despite being homeowners and the money will be used for our kids deposits and other things after age 60.

Yes I should have been clearer, there's only one opportunity to put it towards a property before the age of 60. 

While a house purchase together with your parents is quite an unusual situation, and therefore might not follow other norms, it is common for subsequent house purchases to be funded from the proceeds of the sale of an earlier house purchase. So once you have that boost to your housing capital pool, you get the benefit of reinvesting it in future purchases as well.