What to do - rent, sell, 2nd property and mortgage free

jen_fpb

Firstly, not a newbie but can’t remember details for my old account! Please no judgement on the current finances as myself and husband are happy with this, this post is about the future....

I live with my husband in a house that I have a mortgage on (bought solo after previous marriage breakdown). Husband contributes to bills but I pay the mortgage.

In the next couple of years we would like to buy a house together and have been thinking through the options.

Rent mine - rent for my house is £795, I know this as the two next door are rented at this value. Would likely move to an interest only mortgage to do this. We would then buy a house together. We would have to pay additional stamp duty as while husband is a FTB, I’m not. Tax implications and long term capital gains tax. We may have to put the additional stamp duty on the mortgage but we have the deposit separate. The reason we want to rent is so that thenew house is totally joint and doesn’t have a higher amount put in by me (would be from sale of my house) but is renting to complex tax wise. We don’t plan to rent any other properties.

Sell mine - sell my house, giving much bigger deposit. Wouldn’t have to think about the house being rental or stamp duty or capital gain S tax. Would likely add husband to deeds so capital gains tax allowance doubles.

Pay off mortgage - annoyingly I’ve just remortgage and this fixed deal ends December 2023. We could use our savings for a new house deposit to payoff my current mortgage to live a year or so mortgage free. We would then sell my house and use this as a deposit for a new house. We would put husband on the deeds and get something written so he know what he put into the house.

Any thoughts? Is there anyway to buy a second house solely in husbands name to avoid the second stamp duty, say if I gifted him the deposit?

dimbo61

Your married so financially linked
Do you want to be a Landlord and deal with Tenants and make sure your " Home " is made suitable to Rent ? EICR, EPC, GSC, PAT tested, Fit for habitation, Safe homes standards, Tenancy agreement, references, How to Rent, Right to Rent, Deposits etc etc etc.I
Getting a BTL mortgage and paying Tax on your Rent ( Not profit )
Are you a higher rate taxpayers !
Now you have No Capital gains tax if you sell your home and No inheritance tax.
You won't pay 3% Extra stamp duty
You can put down a much bigger deposit and get a better LTV
You could consider buying as Tenants in Common rather than joint tenants.
You could have an agreement that if your marriage fails you get your share of the deposit you put in and then 50/50 split of the equity on sale 
I would pay normal mortgage payment and overpay by 10% till Dec 23 and start looking for new home next summer/Autumn

Thrugelmir

Treating your finances as being seperate despite being married isn't worthwhile. As seems to have resulted in the tail wagging the dog. Do what's right for the both of you. Rather than creating unneccessary complexity to what should be a more straightforward decision.