Mortgage Help

hannah29_2

ok a bit of a complicated one here.
my mums husband died in the middle of the year and she is desperate to move from where she is. she currently lives in the middle of nowhere on a retirement park. the house is all paid for with no mortagage and she desperately needs a new car. she is on pension credit and gets her council tax paid and just about makes it to the end of each month.
she wants to release some of the equity in her house to allow her to buy a new car and have the minimum savings allowed.
however selling her property will not allow her to buy another closer to town outright.
we have no mortgage and only rent a house due to work.
we have come up with the idea of her selling her house, keeping some of the money back for her car and savings and buying a house with her putting in 50% in cash whilst we have 50% on a mortgage. This will then release the equity she needs and get us a minimal mortgage. We are concerned about how this could affect any benefit she is on and the best way to go with this which helps out both of us. We also are not sure on who to go to for the best advice, a mortgage advisor or a financial advisor.
We would never live in the house and she would live there until she is no longer able, paperwork would be drawn up to cover this possibly charging minimal rent to her if necessary similarly to a house share.
any thoughts or ideas on this would be gratefully recieved
hannah

lynnexxxo

To be clear, the plan would be your mum sells her house (keeps a little equity) and you and her buy a new house, she would pay 50% deposit and you'd get a mortgage for the rest. Sounds a fair plan but the following points occur to me:

You will be taking a mortgage on a house to don't live in. You'd be unlikely to be able to get rent from your mum (as you say she can't affford it) and housing benefit is not normally paid to family members. Can you afford to keep up the repayments if : you decide to buy a house yourself, your circumstances change, maybe you lose your job , you have kids and decide to work less hours.

If your mum needs to go into a home, i don't know what would happen. If it was just her house then it would be sold to pay for it, but as its joint I don't know - I'm sure someone else will be along soon to help you.

hannah29_2

thanks for that lynne.....just to clarify ....we would only charge rent of a minimal amount if paperwork says thats the way it should be i.e 1p a week so that would not be a problem.
we have no plans to buy a house and no intention of doing so, the amount of mortgage we would take out would be for 60k or less and we would be able to pay this off within 2 years if necessary due to the new work contract my husband has just taken on, which is very secure. we have kids already and no more planned definitely!!!!
as you say if she goes into a home the house is usually sold to pay for care. she is 65 and very healthy and active so don't forsee this too soon.
we would be doing this to help her release equity but also to get us investing some money enabling some security at a later date. also in a few years time we plan to travel in our motorhome so aim to use the house as a base address and will stay over on an odd weekend
hannah

lynnexxxo

Sounds like a good plan them - you can afford it and it will improve your mums quality of life.
The only thing you might have to check is that your mum may lose some of her benefits (such as single person council tax discount)if you are using her address as a base address.

Good luck, and the motorhome sounds fab .