HTB - Buying into a property

eskbanker

jamesyhull said:

eskbanker said:

jamesyhull said:

eskbanker said:

jamesyhull said:

eskbanker said:

Provided the property value is within the HTB ISA limit, you can indeed buy into it and use your HTB ISA, but only by engaging a conveyancer to handle the transaction, i.e. it's not simply a case of taking out a new joint mortgage.

I want to do the same but solicitor is saying can't do it as not a purchase??

But that's the point - it has to be handled as a purchase, i.e. formally buying into ownership of the property.

So what are the steps I need to do then? She is buying into the ownership of the property..

Each person appoints a solicitor to act on their behalf, who will explain what's involved in changing the title deeds, etc, and arrange the necessary paperwork and other admin, and should give an indicative cost up front....

jamesyhull said:

What do you mean by a new mortgage please?

Any HTB ISA property purchase needs to include a mortgage on the property, so if changing from sole ownership to joint, that will entail a new mortgage, even if there isn't one currently.

Yes there is a mortgage on the property and there will be when we are both on the property. If I sold this house and we both bought one together she could use the HTB ISA as first time buyer, so there shouldn't be any difference in her buying into this property should there..?

Exactly, there's no difference - in both cases you (individually) are selling at least some of your sole stake in a property and the two of you are jointly buying one (one with HTB ISA assistance), so whether it's the same property or a different one, it's fundamentally the same process as far as the HTB ISA aspects are concerned.

masonic

jamesyhull said:

eskbanker said:

jamesyhull said:

eskbanker said:

jamesyhull said:

eskbanker said:

Provided the property value is within the HTB ISA limit, you can indeed buy into it and use your HTB ISA, but only by engaging a conveyancer to handle the transaction, i.e. it's not simply a case of taking out a new joint mortgage.

I want to do the same but solicitor is saying can't do it as not a purchase??

But that's the point - it has to be handled as a purchase, i.e. formally buying into ownership of the property.

So what are the steps I need to do then? She is buying into the ownership of the property..

Each person appoints a solicitor to act on their behalf, who will explain what's involved in changing the title deeds, etc, and arrange the necessary paperwork and other admin, and should give an indicative cost up front....

jamesyhull said:

What do you mean by a new mortgage please?

Any HTB ISA property purchase needs to include a mortgage on the property, so if changing from sole ownership to joint, that will entail a new mortgage, even if there isn't one currently.

Yes there is a mortgage on the property and there will be when we are both on the property. If I sold this house and we both bought one together she could use the HTB ISA as first time buyer, so there shouldn't be any difference in her buying into this property should there..?

The difference is that it is going to be a lot cheaper to simply add your name to the deeds and mortgage than to go through the formal sale and remortgage process, but that would not make it a qualifying transaction for the HTB ISA scheme.

It would be interesting to understand how this would work in practice, in terms of cashflows. Normally her solicitor would transfer money to your solicitor at exchange and then completion, in total making up the full sale price. Where is this money going to come from?

jamesyhull

masonic said:

jamesyhull said:

eskbanker said:

jamesyhull said:

eskbanker said:

jamesyhull said:

eskbanker said:

Provided the property value is within the HTB ISA limit, you can indeed buy into it and use your HTB ISA, but only by engaging a conveyancer to handle the transaction, i.e. it's not simply a case of taking out a new joint mortgage.

I want to do the same but solicitor is saying can't do it as not a purchase??

But that's the point - it has to be handled as a purchase, i.e. formally buying into ownership of the property.

So what are the steps I need to do then? She is buying into the ownership of the property..

Each person appoints a solicitor to act on their behalf, who will explain what's involved in changing the title deeds, etc, and arrange the necessary paperwork and other admin, and should give an indicative cost up front....

jamesyhull said:

What do you mean by a new mortgage please?

Any HTB ISA property purchase needs to include a mortgage on the property, so if changing from sole ownership to joint, that will entail a new mortgage, even if there isn't one currently.

Yes there is a mortgage on the property and there will be when we are both on the property. If I sold this house and we both bought one together she could use the HTB ISA as first time buyer, so there shouldn't be any difference in her buying into this property should there..?

The difference is that it is going to be a lot cheaper to simply add your name to the deeds and mortgage than to go through the formal sale and remortgage process, but that would not make it a qualifying transaction for the HTB ISA scheme.

Well my fixed deal is up in the next couple of months anyway, so does that make a difference as I need to remortgage anyway? So even if she wasn't a first time buyer I would have to pay solicitors to do transfer on equity and land registry scale fees wouldn't we? 

What are you saying by a lot cheaper?

thanks for everyones advice on here never used this before :-)

masonic

jamesyhull said:

masonic said:

jamesyhull said:

eskbanker said:

jamesyhull said:

eskbanker said:

jamesyhull said:

eskbanker said:

Provided the property value is within the HTB ISA limit, you can indeed buy into it and use your HTB ISA, but only by engaging a conveyancer to handle the transaction, i.e. it's not simply a case of taking out a new joint mortgage.

I want to do the same but solicitor is saying can't do it as not a purchase??

But that's the point - it has to be handled as a purchase, i.e. formally buying into ownership of the property.

So what are the steps I need to do then? She is buying into the ownership of the property..

Each person appoints a solicitor to act on their behalf, who will explain what's involved in changing the title deeds, etc, and arrange the necessary paperwork and other admin, and should give an indicative cost up front....

jamesyhull said:

What do you mean by a new mortgage please?

Any HTB ISA property purchase needs to include a mortgage on the property, so if changing from sole ownership to joint, that will entail a new mortgage, even if there isn't one currently.

Yes there is a mortgage on the property and there will be when we are both on the property. If I sold this house and we both bought one together she could use the HTB ISA as first time buyer, so there shouldn't be any difference in her buying into this property should there..?

The difference is that it is going to be a lot cheaper to simply add your name to the deeds and mortgage than to go through the formal sale and remortgage process, but that would not make it a qualifying transaction for the HTB ISA scheme.

Well my fixed deal is up in the next couple of months anyway, so does that make a difference as I need to remortgage anyway? So even if she wasn't a first time buyer I would have to pay solicitors to do transfer on equity and land registry scale fees wouldn't we?

If you need to remortgage anyway, then just consider the costs of buying and selling a home.

jamesyhull said:

What are you saying by a lot cheaper?

It can vary a lot, but according to Google, the average cost of conveyancing for a property sale for the buyer and seller is about £1000 each, so you'd be looking at paying somewhere in the region of £2,000 extra for your HTB ISA bonus. Could be more, could be less.

If you do decide to go ahead with this, let us know how it goes, as I don't believe anyone has reported being able to do this to date.

Rich2808

eskbanker said:

Rich2808 said:

Yes - you didn't think George Osborne would design a first time buy incentive which didn't involve lawyers and banks/the financial sector getting a cut. If it is about encouraging home ownership solely - none of these things would be needed. Your name is on the deeds, you are now a home owner, here's your help to buy isa bonus cash!

That's one way of looking at it, but conversely, in terms of getting named on property deeds, this always has to be enacted by qualified professionals on each side of a transaction, so is hardly anything HTB related as such, and as the incentive is aimed at those needing assistance with a first-time purchase, those genuinely in that situation will naturally require a mortgage, as it would be a waste of taxpayers' money to be throwing it at those able to buy properties wholly with cash.

But its fine to throw £3,000 at a first time buyer who can afford to buy a £450,000 property in London with £440,000 in cash and a £10,000 mortgage? A waste of taxpayer's money is of course a matter of subjectivity.

Slightly getting off the OP's question but schemes to 'help' first time buyers often achieve the opposite - well for the next generation of them anyway.

masonic

Rich2808 said:

eskbanker said:

Rich2808 said:

Yes - you didn't think George Osborne would design a first time buy incentive which didn't involve lawyers and banks/the financial sector getting a cut. If it is about encouraging home ownership solely - none of these things would be needed. Your name is on the deeds, you are now a home owner, here's your help to buy isa bonus cash!

That's one way of looking at it, but conversely, in terms of getting named on property deeds, this always has to be enacted by qualified professionals on each side of a transaction, so is hardly anything HTB related as such, and as the incentive is aimed at those needing assistance with a first-time purchase, those genuinely in that situation will naturally require a mortgage, as it would be a waste of taxpayers' money to be throwing it at those able to buy properties wholly with cash.

But its fine to throw £3,000 at a first time buyer who can afford to buy a £450,000 property in London with £440,000 in cash and a £10,000 mortgage? A waste of taxpayer's money is of course a matter of subjectivity.

Slightly getting off the OP's question but schemes to 'help' first time buyers often achieve the opposite - well for the next generation of them anyway.

The aim of the scheme was to help first time buyers pay over-inflated prices for their first homes, so that house prices didn't fall. It was to benefit existing homeowners and property developers, not FTB.

eskbanker

Rich2808 said:

eskbanker said:

Rich2808 said:

Yes - you didn't think George Osborne would design a first time buy incentive which didn't involve lawyers and banks/the financial sector getting a cut. If it is about encouraging home ownership solely - none of these things would be needed. Your name is on the deeds, you are now a home owner, here's your help to buy isa bonus cash!

That's one way of looking at it, but conversely, in terms of getting named on property deeds, this always has to be enacted by qualified professionals on each side of a transaction, so is hardly anything HTB related as such, and as the incentive is aimed at those needing assistance with a first-time purchase, those genuinely in that situation will naturally require a mortgage, as it would be a waste of taxpayers' money to be throwing it at those able to buy properties wholly with cash.

But its fine to throw £3,000 at a first time buyer who can afford to buy a £450,000 property in London with £440,000 in cash and a £10,000 mortgage? A waste of taxpayer's money is of course a matter of subjectivity.

Well it's obviously not ideal but still slightly less unpalatable than supporting someone buying a £450K property for cash, and the line has to be drawn somewhere!  But yes, edge cases can always be cited to make a case that a scheme is unfair - the requirement for a mortgage could have been specified as needing to be, say, >50% of property value, but the more such rules are involved, the more complex the administration would need to be, which would in turn be financially advantageous to those involved in providing the services....