Tenancy In Common ?

cathy57

Hi all,
I have roughly £100000 left to pay on a mortgage for a flat I bought over 2 years ago. I don’t live in it but  my brother and visitors use it from time to time. I was thinking of selling it, but my brother has offered to buy 50% of the property to reduce my expenses and give him a share in this property which is worth about £180000. 

He would have to take a mortgage of around £75000 to be able to buy his share.
The idea would be for me pay back most of my own mortgage with his share. 

Is this feasible ? Any comments would be most welcomed. Thank you.

kingstreet

No. You would need to be a party to a joint mortgage with him.

Lenders don't accept bits of property as security.

cathy57

kingstreet said:

No. You would need to be a party to a joint mortgage with him.

Lenders don't accept bits of property as security.

Thank you for your reply. Sorry for my ignorance, but it’s not clear to me. Are you saying he cannot buy 50% of the property if he needs a mortgage ? What can then be done for him to own part of the property ?

simon_or

You and he can own the property in whatever share you want as tenants in common - could be 50-50, 25-75, etc.

But when it comes to a mortgage, you will need to be joint borrowers on one single mortgage. Both of you will be liable for 100% of the debt and the mortgage will be secured against 100% of the property. There's no 'his mortgage' or 'my mortgage' if that makes sense.

cathy57

simon_or said:

You and he can own the property in whatever share you want as tenants in common - could be 50-50, 25-75, etc.

But when it comes to a mortgage, you will need to be joint borrowers on one single mortgage. Both of you will be liable for 100% of the debt and the mortgage will be secured against 100% of the property. There's no 'his mortgage' or 'my mortgage' if that makes sense.

This is very helpful. I have currently a rather good deal at just under 2% for another 21/2 years. With the interest rates being so much higher now, therefore I don’t  think it would be a good move. Thank you.

DullGreyGuy

cathy57 said:

He would have to take a mortgage of around £75000 to be able to buy his share.
The idea would be for me pay back most of my own mortgage with his share. 

Is this feasible ? Any comments would be most welcomed. Thank you.

Presumably you mean the mortgage would be on this property? In which case the above advice stands.

If he owns another property with sufficient equity to release £75k then he could remortgage that property and use the cash to buy into your flat I believe. 

cathy57

DullGreyGuy said:

cathy57 said:

He would have to take a mortgage of around £75000 to be able to buy his share.
The idea would be for me pay back most of my own mortgage with his share. 

Is this feasible ? Any comments would be most welcomed. Thank you.

Presumably you mean the mortgage would be on this property? In which case the above advice stands.

If he owns another property with sufficient equity to release £75k then he could remortgage that property and use the cash to buy into your flat I believe. 

DullGreyGuy said:

cathy57 said:

He would have to take a mortgage of around £75000 to be able to buy his share.
The idea would be for me pay back most of my own mortgage with his share. 

Is this feasible ? Any comments would be most welcomed. Thank you.

Presumably you mean the mortgage would be on this property? In which case the above advice stands.

If he owns another property with sufficient equity to release £75k then he could remortgage that property and use the cash to buy into your flat I believe. 

No, unfortunately he doesn’t own another property but thank you for your comment.