Siblings and inherited property

thenige

Hello,
Myself and my 2 sisters are executors and beneficiaries of my late fathers estate. We are the only beneficiaries. We have probate and we are now looking to sell our fathers property. One sister was living with our father whilst a flat was being sold. They now wish to purchaase our fathers property using the funds from the sale of the flat (due to complete in 3 weeks ), their share of the inheritance  plus a  mortgage. my sister is saying that she cannot get a mortgage  (40,000 GBP )unless her name is on the title deeds. is this correct?  I would appreciate any advice. 

gwynlas

Her name will go on the deeds as part of the purchasing contract, she is buying the house from the estate which remains in your fathers name.
Her mortgage company will probably need to see proof that she is a beneficiary and that the remainder of the deposit comes from sale of current flat, the mortgage company will base their loan on affordability.
The conveyancing solicitor will pay you and your other sister your share of the remainder

thenige

thanks for the information. 

thenige

sorry another question, solicitors are telling me that we have to do a transfer of property form AS1 before the property is sold but I thought this would be done by a conveyancing solicitor as the contracts are exchanged?  I seem to be getting conflicting information ! Not sure who to ask.

Savvy_Sue

Which solicitors are telling you that? I agree with what you think, but I may be wrong. 

RAS

Is you sister trying to buy dad's property using

a) the equity from her own sale
b) her share of the value of dad's estate and
c) a mortgage to make up the remainder?

Have you all three agreed a value for the property? In writing?

And can sister get a mortgage for the remainder on her current income? If you were selling outside the family, the minimum would be a MIP. Will her existing provider allow her to port her existing mortgage? If not maybe she should see an independent mortgage advisor?

She certainly does not need to be on the deeds at present, nor do any of you. We don't need to know your circumstances but there are some serious disadvantages to transferring the property to the beneficiaries before selling. Properties are usually sold directly out of probate.

And it's generally taking 16 months for the Land Registry to transfer properties and many mortgage providers won't lend on a property that has changed ownership in the previous 6 months. It can be expedited but is still problematic.

And just checking, the property in already on the Land Registry?

thenige

hello, thanks for the reply, yes we have agreed to a sale price in writing, the house is already on the land registry and she is funding as per your ABC in the above post. it is the mortgage broker that is now saying her name needs to be on the deeds. i think we are best turning down her offer and putting it on the open market. 

uralmaid

It doesn't make sense.  If she has proof that she has x amount of equity  from her current sale and also proof that she has x amount as a beneficiary then don't understand the requirement regarding her name needing to be on the deeds. If a total unrelated person was purchasing then all that would be required would be proof of funds and equity and the ability to afford the mortgage payments. Their name wouldn't be on the deeds. Think she should look at a different broker or just go directly to a lender.

RAS

thenige said:

hello, thanks for the reply, yes we have agreed to a sale price in writing, the house is already on the land registry and she is funding as per your ABC in the above post. it is the mortgage broker that is now saying her name needs to be on the deeds. i think we are best turning down her offer and putting it on the open market. 

Has she approached her existing mortgage provider to ask them if they will port her existing mortgage or grant another one? 

Or has she got issues with her credit record that preclude her getting the mortgage? It's also quite possible that new providers aren't keen on a very small mortgage. And would prefer a slightly larger one, which she could of course overpay.