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Stuart J
Stuart J, Solicitor
Category: UK Property Law
Satisfied Customers: 20422
Experience:  PGD Law. 20 years legal profession, 6 as partner in High Street practice
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Evening, My grandmother is just over 80 and recently took

Resolved Question:

Evening,

My grandmother is just over 80 and recently took out equity against her property and is paying approximately £450 a month to cover the interest.

She can easily manage this payment but is now not happy with the fact that she is paying for nothing. She has spoken to me and wants remortgage the property to pay off the equity company and any early repayments so that the money she is paying each month is putting equity back into the property.

However she has been refused a mortgage due to her age.

If she was to place me on the deeds as well as herself and using the remaining equity in the property, can I get a mortgage for her?

If I can I then have the problem that due to an ex partner I do not have the best credit rating, despite if need be I could easily cover the mortgage payment if for what ever reason my nan couldn't as after my out goings I have approx £700 a month free after outgoings (based of an approx monthly payment of £550 from a £120,000 mortgage).

I'm not sure what kind of mortgage we would have to get (if we can get one) but it will be like a buy to let.

I basically need to know if:

1. Can we do what my nan wants to do?
If yes how?
If no what other options are there?

2. What kind of mortgage would we have to get?
3. Is my bad credit rating going to effect it, despite my income being able to cover the mortgage if my nan couldn't one month?

Thank you for your help in advance

Miss Evans
Submitted: 12 months ago.
Category: UK Property Law
Expert:  Stuart J replied 12 months ago.

Thank you for the question. It is my pleasure to help you with this today. Please bear with me if I ask for more information.

 





I will answer the
three questions you have asked directly.

There is no reason
why you cannot do what you want to do legally, but there are certain practical
problems.



Firstly, there may
be a redemption penalty on the existing mortgage. So you need to check that.



There is no reason
why you and your grandmother can go on the deeds to the house, and you take a
new mortgage out in your own name, although very often, the mortgage company
will insist on both people being on the title and the mortgage. Some lenders
will not consider it even though it is in joint names because one of them is
elderly. That is their own criteria and not a legal criteria.



If you are not
going to live in the property, then you simply put that to the lender and they
will decide the correct mortgage for you, which is probably going to be a buy
to let type.



Your bad credit
rating will almost certainly affect this but it depends to a great extent on
how much you are borrowing and the value of the property.



I would certainly
not try to arrange a mortgage yourself or visit a high street lender and I
would definitely see an independent mortgage broker who can look at all the
products in the market and when he makes the proposal, can put a case forward.



I will tell you,
but it is not going to be easy, mostly because of your bad credit history.



If the lender looks
at it in the way that your grandmother is gifting you a substantial amount of
the equity, and that you want a relatively small mortgage in comparison, they
will look at it more sympathetically.



Can I answer any
specific points?





Customer: replied 12 months ago.

Thank you for your quick response.


 


So the only thing standing in the way will be my credit rating really, although it's not impossible.


 


How do we go about getting me on the deeds of the property?


 


Also is there a way that my nan could transfer the property into my name completely if so what would this require, would it be a gift?


 


Thank you


 


 

Expert:  Stuart J replied 12 months ago.

The existing lender might agree to add you to the deeds but that is an extremely unusual request after equity release, but you will not know if you dont ask or rather, your grandmother doesnt ask.

You will need a solicitor to do it if the lender agrees but it isnt expensive or time consuming

Otherwise the solicitor will do it as part of the new mortgage process.

To go into your name completely, the existing mortgage will need to be repaid.

Unless you pay full value for the property then if ever your GM needs money to pay for care fees, the council can ask for the legal fees to come out of the house even if it is in your name.

Stuart J, Solicitor
Category: UK Property Law
Satisfied Customers: 20422
Experience: PGD Law. 20 years legal profession, 6 as partner in High Street practice
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