Buying from family member without a mortgage

TBagpuss

Yes, the house could be trasnferred to you with a legal charge secured against it in your brother's favour - effectively he would be acting as your mortgage lender.

You and he would both need to take separte legal advice about the terms of the charge.

Obviously the downsides fo him is he doesn't get his money in a single payment, and he is in the awkward position of potentially having to reposessi f you fail to pay.

You might be able to do it on a short term basis - e.g. have a charge over the house repayable in full in (say) 2 or 3 years time, on the basis you use that time to save so you can get a mortgage in the usual way, and so he gets his money out of the proerpty within a reasonable time.

gettingtheresometime

TBagpuss said:

Yes, the house could be trasnferred to you with a legal charge secured against it in your brother's favour - effectively he would be acting as your mortgage lender.

You and he would both need to take separte legal advice about the terms of the charge.

Obviously the downsides fo him is he doesn't get his money in a single payment, and he is in the awkward position of potentially having to reposessi f you fail to pay.

You might be able to do it on a short term basis - e.g. have a charge over the house repayable in full in (say) 2 or 3 years time, on the basis you use that time to save so you can get a mortgage in the usual way, and so he gets his money out of the proerpty within a reasonable time.

I would also add that you need to approach this as if you were borrowing the money (because that's what you're effectively doing) from a financial institution - so what would you do to safe guard your mortgage payments in the case of sickness etc in a normal scenario.

kingstreet

Maria85 said:

Would it be an option for your brother to lend you the money for the deposit? That way you could secure a mortgage and pay him back the deposit? 

I have no idea whether you could set up a mortgage type arrangement with him but it's worth exploring. If you agree to pay some interest (I would expect mates rates) then he will get more for the house overall than if he sold to a regular buyer.

Definitely seek legal advice and make sure everything is in writing whatever you decide. 

Yes. It is possible.

Schwarzwald

Far too little information provided.

on that base, would only propose why dont you rent if off him until you can buy it from him in a few years down the line?

Titus_Wadd

Schwarzwald said:

Far too little information provided.

on that base, would only propose why dont you rent if off him until you can buy it from him in a few years down the line?

This.   Or explain what's  in it for your brother?

I speak from experience of acting as guarantor for my sister...this is how I now own all her jewellery!  She was full of promises to pay me back...it only took 5 months for her to default.  She never did pay me back before she died!  I love and miss her but family and money don't mix.  You think you'd never miss a payment but family can be forgiving and manipulated in a way a bank or landlord can't.   I just can't see how this benefits your brother even if you properly set up a private mortgage; you might as well ask him to give you the house!

Titus_Wadd

Just spotted that it was your family home, so was it left to both of you in a will?  Did you get something else from the estate?  If you still had a share you could rent your brother's  half at a reduced rate maybe?
OP, come back with more info, we're not trying to be critical of the idea, but there's  possibly more to the scenario that you first said and there could be other ways for you to live in this house if it's  so important to you.

dimbo61

Have you looked at a YBS Offset mortgage ?
Can you get a mortgage IF your brother gifts you say 25% of the property value as a deposit ?
You then take out a YBS offset mortgage and your brother IF he wants too can open an offset account helping to offset YOUR mortgage interest each month.
He has a sum of money which he can tap into at any time. 
You have No control over his savings.
You own a home with YBS as your mortgage lender.
Each time you make a mortgage payment he can withdraw the same amount and spend it or save into a regular saver.