A loan to a family member

notahopeinhell

Hi, everyone.

I don't know if there are any "legal eagles" on the forum but I'll ask my question anyway.

Next year my daughter and her husband need to obtain a new mortgage as their fixed rate one comes to an end. In order to reduce their monthly repayments and the risk of losing their home if disaster struck I am thinking of loaning them part or all of the money they need to redeem their mortgage.

My question is if I loan them the money and draw up a document saying how much they have borrowed, the amount repayable each month/year and the total would the document be legally binding on all parties separately and jointly? For example if they divorced or one partner died or the property was sold?

Hopefully none of this will happen of course but as I would be lending them our entire life savings I cannot afford to simply "lose" the money as their repayments would form part of our monthly income.

The house would be in their name, unless I loaned them only part of the money they need in which case the B.Soc. would also have an interest in the property. I assume the building society would extract the details of my loan in the process of the mortgage application?

Any help gratefully accepted.