Morgage / benefits / parents house

phill2-0-0-3

Hi 

I have moved in with my parents . 
With my partner and child .
We exstended the house all around to make it comfortable for all of us  . 

Unfortunately due to a planning issue we have to spend around £20000 making changes to the property . 

We don't really have funds for this . 

We are looking into a morgage . 
The property is morgage free at present 

The house is to be gifted to me and my sister to apply for the morgage  . 

I have been told to arrange the morgage first so the house is transferred at the same time . 

My parents will still leave here which I will need to notify to the morgage company . 

I have had to drop my hours at work as I care for my partner and parents and have a new born ontop also children from a previous relationship. 

So we get tax credits at present . 
It will only be me and my sister on the morgage although my partner does work and contribute to bills . 

My sister works and earns around £1100 pm . 

I earn around the same with work and tax credits . 

I used a broker previously which was fine 
But as the morgage I need is only £50'000 they require a £1000 fee from myself where previously this was free . As the morgage is so low . 
The extra will be to modernize the inside of the property as very dated and for other jobs .

So would it be better to either ring the previous lender and see if they could help 

Or just get a few loans but obviously this can't be stretched over 25 years like a morgage .

Does anyone no any banks that would likely accept these sort of issues . 
My credit score is perfect .
And I have no loans or depts as of yet . 

Many thanks 

kingstreet

"My parents will still live here which I will need to notify to the mortgage company."

This will be a major issue for most of the lending market, greatly restricting your options.

MovingForwards

You mention already caring for your parents, do they have other assets aside from the property? If they need external help / have to go into care, giving away the property could be seen as deprivation of assets.

MWT

How old are your parents and what would you say is the approximate value of the house?

amnblog

This is a very complex case although there will be options.

If a broker with the necessary knowledge and experience wants to take this on and receive fees from the Lender only I would question their sanity.

You say you need £20,000, but intended to borrow £50,000 (perhaps due to minimum loan levels), if this is the case the Broker fee is available.

enthusiasticsaver

You have several problems here.  The first is that gifting the house will be seen as deprivation of assets if either of your parents needed to go into nursing or residential care.  The second is many banks won't take benefits as income so you may not have enough income to get a mortgage.  The third is that lenders do not like other people living in a property which is to be mortgaged so having your parents and partner living in the house but not named on the house or the mortgage will be an issue.  Does your sister not  have a mortgage on the house she actually lives in? If so that will be taken into account if she intends applying for a joint mortgage with you.  

It sounds like a very complicated way of raising £20k so you will need a broker which means a fee usually. 

phill2-0-0-3

Thanks for the responses

My sister lives in the house with us .
40+

When the house is complete will be worth around 450/500'000
At present untill the exstention is signed off around 325'000 . 

Parents are 68 and 73 . 

Hopefully they won't go into care .
One of the reasons I'm doing this .

But if this does happen then either me and my sister will have to try and find the funding along with there pensions / savings 

As for the £20000 but needs £50000 . It seems £50000 is the minum for morgage and the internals need work to modernize anyway . 

So it seems a broker is the only option . 
I'm unsure if a loan would be more feasible .
But at present I'm unsure if this would happen due to my income .

My freind has a morgage and they are in receipt of benefits & work low income
But no parents living there . 

getmore4less

There are lenders with lower limits than £50k  but you need to find one that would match your  other criteria which is probably harder.

How did you get so far through an extension without proper planning? 

phill2-0-0-3

I have full planing permission . 
But as we was going we made some changes to the design . 
We informed the architect before hand who come out and took measurements . 
Then said he would submit to the council and send the working drawings for the changes . 
He sent us the working drawings , only working drawings we received took 6 months . 
So we built to what he had sent without realising he never got the changes approved .