Right to buy

samson13

Hi i'm new on here and not sure weather this is the correct forum to post this on but here goes!

My grans lived in her council house for about 40 years so she's basically payed for the house about twice over! she's in her 90's and has just decided she want to buy the house so she has something to leave me and my sister.

We put in the aplication for the right to buy and have had the survey done etc and have a price after the full £24,000 discount of £91,000.

Unfortunatly even with me and my sister offering to go as guarantors on the mortgage the mortgage adviser couldnt find any lenders prepared to take this mortgage on.

We both rent at the moment so dont have our own properties at present so we cant raise finance that way so seem to be a bit stuck as to where we can go from here??

Any advice would be much apreciated.

PasturesNew

I can't see the benefit even if she DID get a mortgage.

All I can see is she'd be forking out a fortune on a money pit for no reason/benefit whatsoever.

What was the mathematical and logical thought process behind this idea?

LillyJ

Has she thought about the implications should she have to go into care? If she has a small amount of savings, then she will end up having to sell her house to pay for it.

I can see the logic - buy for a discount, you inherit the house, then sell it or move in yourself, and eventually you will get the full market value for the house and pocket the difference.

Kez100

If no one defaults on the mortgage in the meantime that is. Who is going to fund the 91k mortgage repayments?

free

i would move in with her and have her include your name on her secured tenancy agreement with the council. With your name on her tenancy agreement you will be eligible to succeed the tenancy after she passes on. You would also be eligible to buy the property with your name on the tenancy. You need to live with her for a minimum period, in order for this to happen. It could be six months or a year, cant rememeber. I had a friend who inherited her sisters tenancy after her sister moved out. Ring up your local council and ask for the requirements for this. Dont let them forbe you off.

Regards

PasturesNew

Without some clue from the OP as to how they saw the deal fitting together and working over the next 10-20 years, I tried not to think through the problems. For they are many.

I am assuming that they're just working on her outliving the 5 year tie in period. So they can pocket the £24k + gains. And that's where there's another major flaw. With prices dropping, in 5 years it might be in negative equity anyway.

The mortgage needs obtaining, paying. Maintenance needs doing. Then there's a will to be made. And if other relatives shout "UNFAIR" etc etc. Could cause family rifts.

And what if she goes into a home, it'd be sold anyway. So all that scrimping/paying for nothing. And if it is sold within that 5 year period I guess the discount still needs paying back - AND - it might be in negative equity - AND - maybe nobody wants it (council properties fare less well in a house price crash than many other types).

etc ... etc ... etc.

PasturesNew

free wrote: »

i would move in with her and have her include your name on her secured tenancy agreement with the council. With your name on her tenancy agreement you will be eligible to succeed the tenancy after she passes on. You would also be eligible to buy the property with your name on the tenancy. You need to live with her for a minimum period, in order for this to happen. It could be six months or a year, cant rememeber. I had a friend who inherited her sisters tenancy after her sister moved out. Ring up your local council and ask for the requirements for this. Dont let them forbe you off.

Regards

Those transfers, last time I looked, could only be done once.
Usually a tenancy was in a man's name (for her generation) and often the one transfer occurs when the man dies and the wife takes it over.

I've seen instances where an adult child has then been turfed out of the home when their mum subsequently dies because that would require a second transfer, which was against the rules.

So it might not be possible.

ruggedtoast

samson13 wrote: »

Hi i'm new on here and not sure weather this is the correct forum to post this on but here goes!

My grans lived in her council house for about 40 years so she's basically payed for the house about twice over! she's in her 90's and has just decided she want to buy the house so she has something to leave me and my sister.

We put in the aplication for the right to buy and have had the survey done etc and have a price after the full £24,000 discount of £91,000.

Unfortunatly even with me and my sister offering to go as guarantors on the mortgage the mortgage adviser couldnt find any lenders prepared to take this mortgage on.

We both rent at the moment so dont have our own properties at present so we cant raise finance that way so seem to be a bit stuck as to where we can go from here??

Any advice would be much apreciated.

Im sorry but you answered your own question. No one wants to give a mortgage to a 90 year old council tenant in a falling market even with a guarantor. If you cant get 97k from elsewhere then youre out of luck.

As others have said I think this might be for the best though.

poppy10_2

It's all moot. Noone's going to give a 90 yr old a mortgage anyway.

With no income, there's no way she'd be able to pay back the loan in the few years she's got left before she dies. What then? Would you expect the life insurance to just pay out and let you have the house for free?

JoJoArmani

I think this is another wind-up post.

Lots of odd posts popping up by newbies who never return to reply... and always controversial topics...hmmmm???

PasturesNew

It gives us something to chat about until the next property price report is released into the media.

Keeps us off the streets.