Mortgage for 60 year old First Time Buyer with no Deposit

SirQuej

Hi Guys

I'm after some advice for my sister (which I will call Sister 1).  I'll explain her situation (which is a little complicated).

When her dad died (we have different fathers/same mother), Sister 1 and my other sister (Sister 2) inherited his home which was Mortgage free. 

Sister 1 was living in the house and they didn't want to sell it so Sister 2 took out a mortgage against the property for the total of her share.  She had to take the Mortgage in my nieces name however because both Sister 1 and Sister 2 didn't have very good credit.

So the current situation is that Sister 1 is still living in the property which is worth around £150k.  There is an outstanding Mortgage on the property of around £85k in my nieces name.

Sister 1 wants to get a Mortgage to pay off the outstanding mortgage so that it is all then in her name.

There are two issues:

Issue 1: Sister 1 is 60 years old
Issue 2: Sister 1 doesn't have a deposit

I know some lenders who are prepared to lend to older borrowers and I also know that a "Retirement Interest Only Mortgage" is an option for older borrowers.

My question is based around the deposit issue.  She would be getting an £85k mortgage to buy a house valued at around £150k.  Will she need a deposit in this situation?

Also, is it even possible to change the name on a mortgage?  So would the Lender of the Current Mortgage be prepared to change the current mortgage over to my Sisters name and remove my niece?

Thanks in advance for any advice.

MovingForwards

S1 already has a deposit, it's her equity share in the property.

She may be able to get a regular mortgage, it all depends on her income.

RIO mortgages are slightly tricker as they have fixed percentages they will lend, she's also young to be looking at this and if possible something to think of in future years.

One issue the niece will encounter is capital gains tax as this house has not been her home / where she lived.

If you can confirm approximate income, whether it's from salary, self-employed income, benefits, pension etc that will help people work out numbers and say what options could be considered.

SirQuej

Thank you.  That was pretty much what I hoped the situation was regarding the deposit so thanks for that.  I will get her financial details from her and post them up later and hopefully we can then take it from there.

Re the capital gains tax issue...my niece wouldn't be "Gaining" anything.  She has a mortgage on the property that would simply be paid off.  Sister 1 already owns half the property (her inheritance).  Sister 1 is simply buying sister 2's share of it.

TrickyDicky101

I think you need to confirm what the ownership details actually are because, whilst not impossible, it is very unusual that a mortgage would have been advanced on the property if one of the joint owners (ie Sister 1) is not also a party to the mortgage.  Are you certain that Sister 1 is not also named on the borrowing or, alternatively, that Sister 1 is definitely on the Land Registry title?  The latter (not named on title) would complicate things.