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Ask Clare Your Own Question
Clare
Clare, Solicitor
Category: Property Law
Satisfied Customers: 34232
Experience:  I have been a solicitor in High Street Practise since 1985 with a wide general experience.
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I want to sell a portion of my house to raise some capital.

Customer Question

I want to sell a portion of my house to raise some capital. What form of agreement outline is best for this?
Submitted: 2 years ago.
Category: Property Law
Expert:  Clare replied 2 years ago.
HiThank you for your questionMy name is ***** ***** I shall do my best to help youCould you explain a little more about the arrangements you intend to makeClare
Customer: replied 2 years ago.

Here is the outline



1. you will purchase a share in the property, Flat 4 Weatherbury,***** Notting Hill, W2 5LF. the share shall be the current market value of the equity in the property + 2%

The property was purcahsed for £340,000 in April 2007

2. Current market value is approximately £700,000 as of Sept 2015 making the equity around £360,000

3. For the sake of this arrangement I will say that the £3,600 is equal to 1%

4. The monthly mortgage is £1070

5. Arrears are approximately £5500 ( including charges)


6. You will pay the next 5 months mortgage monthly on the 3rd of the month 5 x £1070 = £5350 this will end Jan 2016

7. You have paid £1070 in August 2015 meaning that there are only a remaining 4 months to pay.

8. You will pay a sum of approximately £3000 towards the areas this week with the balance to be cleared in the following two weeks.

9. A sum of £1200 will be paid at a date to be agreed in the next month, taking the investment promised to £12,000 or 3.5% of the current equity value, which will give you a 5.5% sake in the equity if and when the property is sold.

10. I will draw up legal binding papers in the next month.

11. You can invest more if you wish up to a value of 10% equity in the property if you wish.
Expert:  Clare replied 2 years ago.
So this person is "buying into" the property.Has the Mortgage Company agreed to this, if not is the purchaser aware that he or she cannot be added to the Title deeds?Clare
Customer: replied 2 years ago.

No its a private agreement, when the arrears are brought up to date should be be any issue with the mortgage company agreeing to this?

Expert:  Clare replied 2 years ago.
Is the purchaser aware that they cannot be added to the title deeds unless the Mortgage Company DOES agree?
Customer: replied 2 years ago.

Yes and in fact she is giving me the money for my business but she is securing this against my house. She trusts me as we have worked together for some years. We are primary concerned that this agreement as we have outlined have makes sense, then she will pay the arrears and I will then inform the mortgage company.

Expert:  Clare replied 2 years ago.
Hi
I am not clear - will this be the payment of Lump Sum - or a Lump sum and ongoing instalments?
COULD it be one lump sum payment?
Clare