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Aston Lawyer
Aston Lawyer, Solicitor
Category: Law
Satisfied Customers: 10780
Experience:  Solicitor LLB (Hons) 23 years of experience in Conveyancing and Property Law
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I went to see a mortgage advisor the other day as I have my

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I went to see a mortgage advisor the other day as I have my house up for sale as it is in need of repairs I can no longer afford to keep up with and I wanted to know what mortgage I could look to getting so I can downgrade before my retirement in 10 years time. And I have now found I will be homeless in 6 years and 2 months time anyway.
I have blanked out names for now everything else is as worded by the advisor:-
Attended X – 10/07/2014 – 2hrs
Hi X,
Please see below my understanding and thoughts about your situation. There will be no charge for the time yesterday and time spent this morning. If you are minded to remove your property from the market, then please can you contact Taylor Bourne Direct and let them have your instructions
The property is in the joint ownership of Mrs X (Aged 56 NB) and Mr Y. Mr Y does not reside in the property but nevertheless pays the contractual interest only mortgage payments of £235pcm.
Assuming the property sold at say £120,000, the Equity in the house is about £49000 less legal and selling cost.
There is a dispute between Mrs X and Mr Y which has not been settled, relating to a transfer of equity transaction from years ago for nil consideration from X to X+Y and a simultaneous re-mortgage whereby the prevailing mortgage of approx. £18,000 was increased to £70869 to yield a sum of approximately £53000 that was used wholly for the benefit of Mr Y to repay his personal debts and purchase an overseas asset in his sole name. No evidence subsists of his overseas asset or his whereabouts. The Mortgage at the time, was established upon an interest only basis with no capital repayments and currently sits on a variable rate of 3.99% @ 235pcm interest only with a redemption date of November 2010? The Mortgage term ends in 6 yrs and 2 months and must be repaid at that time. The Mortgage cannot be transferred to another property in its current form because X’s income is inadequate to support that level of borrowing. Mortgage lender will lend about £25,000 maximum based upon a term of 10yrs.
I note that X has no assets nor retirement provisions and is heading for retirement upon a pension credit income profile. In order to repay the mortgage in time for the end of the mortgage term of 6yrs, she would have to be established upon a capital and repayment basis and based upon a 6 year term @ 3.99% that would require a monthly payment of £1,108pcm to discharge the debt within 6 years. An impossible task! It is neither possible nor advisable to extend the mortgage term with her current lender or re-mortgage the debt to another lender.
An analysis of X's current income and Expenditure suggests that she can support a housing cost of no more than £120pcm. If X increased her hours to 30hrs pw on the same pay, she would become eligible to receive £914pa working tax credit. As she currently works less than 30hrs pw, she is ineligible to claim Working Tax Credit as a single person.
Based upon an available spend of say £120pcm for her housing needs and a mortgage term of 10 years to age 66, the maximum that X could afford to borrow on a typical 5 year fix rate of say 3.59% would be £12,083 = £120pcm monthly capital and interest. If X was to receive the full equity in her house, she could buy a freehold for circa £58,000 (£46000 Net Equity plus say mortgage of £12,000) There are some lenders that would be willing to lend more, perhaps to say £25,000, but that would mean X taking on a mortgage beyond her means. There may be some scope for X to purchase a shared ownership property as the rent for the other half share may become eligible for a housing benefit claim ( I am not a welfare rights adviser, therefore I recommend that X seeks professional welfare rights advice from the appropriate agency)
X has stated that she would be willing to negotiate for Mr Y
to continue to pay her an income into the future. This income would not be an acceptable form of income for assessment for borrowing against a mortgage or taking on a tenancy.
I have had an offer from my parents to have me live with them and an offer on the house for £120K.I was wondering what the next step was?
Hello and thanks for using Just Answer.
My name is ***** ***** am a Conveyancing Solicitor and am happy to assist you with your enquiry.
In respect of your current position, I confirm that your existing Lender will insist that you repay the Mortgage when it expires in 6 years. Some Lenders in the current financial climate will not force a Borrower to repay at the end of the Mortgage term, provided the interest continues to be paid but this is only on an informal basis and I can't say your Lender would agree to this in 6 years time.
It therefore appears to me that your best option would certainly be to proceed with the Sale now, so that the Mortgage can be repaid and you can start again" with a clean slate".
From what your financial advisor has said (and he/she appears to have been very competent in assessing your situation) it appears to me that you may find it hard to purchase another property unless Mr Y allows you to keep all the equity and you find a Lender who will indeed lend to you.
As regards ***** ***** most Housing Associations will want to see that an applicant can afford the "rent element" and I doubt it very much that they would agree to sell to a party who will be relying on Housing Benefits.
The other alternative is to rent a property, but again a monthly rent is likely to be at least the same amount as you would need to pay under a shared ownership (the Mortgage and rent elements).
The offer to live with your Parents seems the practical solution.
As regards ***** ***** with your Sale, the following issues need to be addressed-
1. Mr Y of course needs to consent to the Sale (he will need to sign the Sale Contract as joint owner).
2. Agreement will need to be reached by both of you as to how is to get what from the equity. I note the potential dispute in this regard in that your property was re-mortgaged and put into your joint names to enable Mr Y to pay off his debts.
Legally, if you hold the property as Joint Tenants, both of you are entitled to receive 50% equity each. If you are holding the property as Tenants in Common, you both receive your appropriate percentage share from the equity. You do therefore need to take advice from a local Solicitor concerning this.
I am not sure if you and Mr Y are married, but if you are, then if you were to issue divorce proceedings, an agreement can be reached as to who should get what and the usual rule that each party receives 50% from the equity if the property is held as Joint tenants will not apply, and you could argue that you are entitled to a larger percentage.
Of course, if Mr Y is happy for you to receive the full equity, then the above will not apply.
I hope this gives you a good summary of your situation and that I have assisted you.
Please let me know if you require any further clarification.
Kind Regards
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Customer: replied 3 years ago.

We are not married and i only signed the house over to him as we were engaged to be married and he already had another girlfiend within months of taking my money, he has paid interest only back since Jan 2006. I was wondering if i could try and ask him payments to myself for my future ?