Adding my name to the deeds and mortgage

kazzamunga

Hey just wanted to ask re our current mortgage situation.

I live with my partner and the house is in his name, but I've always paid towards the bills and mortgage. When the house was bought, I had my name on the mortgage of another property that we hadn't managed to sell yet, so it was easier to go with his name only. That property has since sold. He had a job at the time that he doesn't have now, and I'm currently paying for the mortgage and all bills, while he is trying to get a new business off the ground. It's fine, we live in a cheap place and it's a small mortgage, we trust each other, etc.

Obviously I would like to get added to the deeds though, and be acknowledged for the role I'm playing in the payments – currently I never even know which box to tick when I'm asked if I'm a homeowner, tenant, etc. – which I find annoying in itself!

I just wanted to ask if there are any risks in doing this. I am self-employed, which I know the mortgage companies hate, but the mortgage is small – less than £90k, and my average earnings over the last two years is around £40k. The house has also gone up in value from when we bought it by around a third. So the mortgage is about 60% of the value. But obviously we would be raising our heads above the parapet and saying that my boyfriend's earnings aren't what they were, and I wondered if that might possibly leave us in a situation where they won't lend to either of us – my boyfriend because he doesn't earn enough or me because I'm self-employed. And what could we do if they did do that. We've never missed a payment etc., but I know the algorithm doesn't care about that. Thanks!

kazzamunga

Worth saying as well that my earnings are around £40k at the moment, and his earnings were around £23k when he was offered the mortgage – so I'm hoping that difference is security for the bank?

pjs493

Worth getting an agreement in principle from a lender to test the waters with your new situation to see if you could have the mortgage together when it’s up for renewal. My husband and did this when he owned a flat that had been rented out for years. We were financially codependent and it seemed like a sensible thing to do. We had an agreement in principle in hand and spoke to the mortgage company who suggested waiting until the current term was up (a couple of months later) and making the change then to avoid extra fees. 

In the end we didn’t go through with it because I’d never bought a home before so our financial advisor suggested I preserve my first time buyer status. Especially because at the time we were considering getting another rental property, or just retaining my status for when we decided to buy our forever home at retirement (we moved a lot with my husband’s job and had accommodation provided by his employer).

Another option is to have a solicitor draw up papers showing that despite one person being on the mortgage, the other also has a financial interest in the property. I’m not sure how this would work in your situation because you’re not married, but for us with a rental property it meant we could share the rental income. At the time I was earning less than my husband and we were worried that the rental income was going to push him up into the next tax bracket with implications for things like child benefit).

in my situation, my husband died suddenly a year ago and in hindsight it was good that we didn’t make any changes because I was able to pay off the mortgage in full when granted Probate. If we had a joint mortgage I would have just had to continue paying it or pay exit fees to pay it off. Obviously our situation was rare because my husband was fit and healthy and died unexpectedly. I just wanted to explain why I was writing it all in the past tense. 

kingstreet

Your current status is "living with friends/relatives."

Are you planning on asking the current lender for addition to the existing mortgage and a transfer of equity to add you, or are you planning to remortgage to a new lender and doing the TOE at the same time?

Typically, as long as you meet affordability on a joint basis with what is effectively a dependent partner, you should be fine.

Try the details in affordability calculators for the existing and potential new lenders and if uncertain, have a decent broker look at it for you. Ask friends/relatives for a recommendation.

Lenders don't hate the self employed. If you have two years accounts or two years HMRC tax calculations & tax year overviews practically every lender will lend to you.