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Our property investment expert is Jeni Browne, Sales Director at
Mortgages for Business
www.mortgagesforbusiness.co.uk/
Tel: 0345 345 6788
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Question
Tenants in common – need advice
My partner and I are buying a property together. He owns his own flat – which we both live in – and he also works full time. I am a first-time buyer and a stay-at-home-parent.
He wants us to enter into agreement where we are ‘tenants in common’ and he will own the majority of the property and he is proposing I will own the smaller share to reflect the smaller deposit I am contributing and the fact I am currently not working.
Where will this leave me down the line? Could I change the mortgage if in a couple of years’ time I return to work? I am a little confused and don’t know where to turn for independent advice. I am not sure I can afford a solicitor at the moment.
Answer
The ownership set up is not necessarily mirrored in the mortgage terms and conditions, meaning that from a mortgage lender’s perspective, you both own the property jointly.
If you did want to vary the percentage of ownership down the line, you would require a solicitor to get this changed. In terms of getting advice now, the solicitor you are using for the purchase should be able to advise you and run through the benefits and implications with you.
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Question
Can my child’s ‘rent’ be included in mortgage application
My 22-year-old son has just landed a job working for a software company in London and is hoping to live at home for a few years because it’s convenient for work (and means I will do his washing!)
He has agreed to pay us some ‘rent’ each month to put towards our mortgage payments. It won’t be a lot – perhaps £250 or £300 a month. We are due to remortgage and we wondered whether we could include this as additional income towards our own repayments?
Alternatively, could my son be named on the mortgage to make his contributions formal and would this, perhaps, help him when applying for his own mortgage further down the line?
Thanks for any advice.
Answer
Unfortunately, the rent your son pays you would not be taken into account by a mortgage lender. If you do add your son to the mortgage then his earned income would be included. However, the mortgage deed and property title deed legally have to match, meaning your son would need to be a joint owner of the property.
Doing this may trigger stamp duty and could also impact his ability to access first-time buyer stamp duty relief in the future.
I would suggest you speak to your mortgage broker, who will be able to advise you on all your options.
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Question
New job – can I get a mortgage?
I have been on furlough for the last three months and have subsequently been made redundant. Fortunately, I have found a new job which will pay slightly less than I was getting before, but only by around £50 a month.
To add to this drama, I was also due to buy a new house before the Covid outbreak. This has been put on hold but, obviously, my mortgage in principle no longer applies as I have a new job.
Do you know what my chances are of getting a new mortgage? How will I provide proof of my new employment and how will the lender view the fact I am ‘between’ jobs?
I start my new job in August and therefore won’t receive my first wage until August 22. I am purchasing the house alone so have no other income to consider.
Answer
I’m sorry to hear you’ve had such a tough few months, but congratulations on getting a new job so quickly!
Some lenders are willing to accept mortgage applications based on just a job offer, so do speak to a mortgage broker who will be able to advise you of your new options. Good luck!
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Question
Help to Buy – paying off equity
I wonder if you can help me. I have a help to buy mortgage. I am now in a position to pay the equity part of my mortgage off but I don’t have enough funds to pay the help to buy off. Can I keep that running?
Answer
I’m hoping I’ve understood your question correctly, so sorry if I haven’t! If you want to pay off the ‘help to buy equity loan’, but do not have sufficient funds at the moment to clear the whole mortgage, then yes this is possible. Clearing off the equity loan does not impact the main mortgage.
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