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  1. #1

    Buying a house with equity belonging to dad’s property?

    So, the scenario:

    Dad bought a property for us to live in as tenants, as we weren’t able to get on the property ladder ourselves due to redundancy and property market crash.

    As much as we’ve tried to get enough deposit together to buy the property off of him, we’ve realised we’ve outgrown the house and so would want to put it on the market. The local area has become too expensive for us to buy another home, so are looking to relocate to another area where we can get something twice the size for 100k less.

    Numbers- wise:
    Dad bought the house for 170k, we’ve paid him rent to cover the mortgage since. House now valued about 400-450k.
    Property we’re looking at is 320k, so plenty of equity released.

    However, I can’t get any mortgage in my name as I’ve been part-time for so long and changed jobs fairly frequently (due to redundancy and maternity leave) so it all has to be in hubby’s name. He hasn’t a lot of debt he wants to clear with the proceeds of the house sale.

    In order to get a mortgage offer, (really dumb question sorry!) would we need to have sold our current house, that has all the equity so we can release the deposit, or are there lenders out there who agree mortgages in principle if we get written confirmation from dad about releasing part of the equity to us?

  2. #2
    So your deposit is coming from a gift from your father? You can submit an application based on that, just bare in mind that the equity will need to be released by your father before you complete.

    How will he release the equity? By selling it or by way of raising a mortgage against the property?

  3. #3
    Thanks for the response.

    He will raise the equity by selling the house. Since he bought the house he’s emigrated with my mum, so is keen obviously to lose any financial ties to the UK, hence suggesting this.

  4. #4


 

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