Mortgage Exit, solutions?

Leakingtile79

Hello All,

Ive got a situation I would like some advice about. My partner bought a house 3 years ago with a friend of them, they got a 5 year fix mortgage, which is due to end in June 2027. My partner and myself would like to buy a house together to move there, below are the options I have in mind:
-Option 1: She sells the current house with her friend and then we buy our house together. The problem of this is that breaking the fix mortgage term will incur in fees, which I believe would be prohibitive.
-Option 2: They keep that house they have together and we buy a house together. We have enough money for a 10-15% deposit, Im a first time buyer, and could get easily more than have of the mortgage. But I am not sure if she could get another mortgage, that would be the ideal situation for us as then the house will be bought together. Her friend would stay in the current house, but I am not sure how that would affect the bank/getting the mortgage for her.

MAny thanks in advance!

Emmia

Can the friend afford the mortgage on property 1 alone?

Can the friend buy your partner out?

Can you afford to buy your property solo and pay the mortgage solo?

MattMattMattUK

Leakingtile79 said:

Hello All,

Ive got a situation I would like some advice about. My partner bought a house 3 years ago with a friend of them, they got a 5 year fix mortgage, which is due to end in June 2027. My partner and myself would like to buy a house together to move there, below are the options I have in mind:
-Option 1: She sells the current house with her friend and then we buy our house together. The problem of this is that breaking the fix mortgage term will incur in fees, which I believe would be prohibitive.

Probably not prohibitive, but the early termination fees would fall on your partner, not their friend and the friend could well frustrate the process or delay it anyway. It may not matter to you but it might also end the friendship by making the friend sell their home.

Leakingtile79 said:

-Option 2: They keep that house they have together and we buy a house together. We have enough money for a 10-15% deposit, Im a first time buyer, and could get easily more than have of the mortgage. But I am not sure if she could get another mortgage, that would be the ideal situation for us as then the house will be bought together. Her friend would stay in the current house, but I am not sure how that would affect the bank/getting the mortgage for her.

MAny thanks in advance!

You would also have to pay higher rate stamp duty as your partner already owns a property, you would pay an additional 5% SDLT on top of the standard rate, you will also not qualify for a first time buyer discount as your partner has already owned the home.

https://www.gov.uk/stamp-duty-land-tax/residential-property-rates

Realistically your best choice is either you buy the property yourself and your partner pays you rent (which also means that they cannot contribute to the deposit), then buys into the property in 2027, or you rent until then, then buy together. 

Albermarle

Leakingtile79 said:

Hello All,

Ive got a situation I would like some advice about. My partner bought a house 3 years ago with a friend of them, they got a 5 year fix mortgage, which is due to end in June 2027. My partner and myself would like to buy a house together to move there, below are the options I have in mind:
-Option 1: She sells the current house with her friend and then we buy our house together. The problem of this is that breaking the fix mortgage term will incur in fees, which I believe would be prohibitive.
-Option 2: They keep that house they have together and we buy a house together. We have enough money for a 10-15% deposit, Im a first time buyer, and could get easily more than have of the mortgage. But I am not sure if she could get another mortgage, that would be the ideal situation for us as then the house will be bought together. Her friend would stay in the current house, but I am not sure how that would affect the bank/getting the mortgage for her.

MAny thanks in advance!

Another option could be for you to move in with your partner.
The friend may or may not like this idea, but if you were paying a decent financial contribution as a lodger, they may be more accepting ( assuming your relations are at least cordial).
It would also allow you to see if you and your partner can live together happily, before committing to buying a house together.