Houses - Shared ownership/Mortgages
Discussion
This has no doubt been covered before but without the search function I can't find it.
Speaking to my Dad last night about my sister's house, it looks like her (+ husband + baby) are looking to sell their house because they can't afford the mortgage due to a change in financial circumstances (not really their fault but that's for another post!).
I think that this would be a stupid idea right now unless they really are desperate.
My question is; is there anything that both myself and my parents can do to help out?
Their mortgage is about £117k and I imagine that they could probably more than comfortably afford it if they halved their mortgage costs.
Would it be in any way wise to offer to go into some sort of shared ownership with them and my parents i.e. 50% sister/husband, 25% me, 25% parents?
Obviously I'd have to ride out the dip in the market but this would leave me quids in if I do ride it out and the house prices go up? Would it be a good long term investment?
Any thoughts, or alternative recommendations?
Speaking to my Dad last night about my sister's house, it looks like her (+ husband + baby) are looking to sell their house because they can't afford the mortgage due to a change in financial circumstances (not really their fault but that's for another post!).
I think that this would be a stupid idea right now unless they really are desperate.
My question is; is there anything that both myself and my parents can do to help out?
Their mortgage is about £117k and I imagine that they could probably more than comfortably afford it if they halved their mortgage costs.
Would it be in any way wise to offer to go into some sort of shared ownership with them and my parents i.e. 50% sister/husband, 25% me, 25% parents?
Obviously I'd have to ride out the dip in the market but this would leave me quids in if I do ride it out and the house prices go up? Would it be a good long term investment?
Any thoughts, or alternative recommendations?
Mag1calTrev0r said:
This has no doubt been covered before but without the search function I can't find it.
Speaking to my Dad last night about my sister's house, it looks like her (+ husband + baby) are looking to sell their house because they can't afford the mortgage due to a change in financial circumstances (not really their fault but that's for another post!).
I think that this would be a stupid idea right now unless they really are desperate.
My question is; is there anything that both myself and my parents can do to help out?
Their mortgage is about £117k and I imagine that they could probably more than comfortably afford it if they halved their mortgage costs.
Would it be in any way wise to offer to go into some sort of shared ownership with them and my parents i.e. 50% sister/husband, 25% me, 25% parents?
Obviously I'd have to ride out the dip in the market but this would leave me quids in if I do ride it out and the house prices go up? Would it be a good long term investment?
Any thoughts, or alternative recommendations?
Just give them the money each month for a bit, if you trust them.Speaking to my Dad last night about my sister's house, it looks like her (+ husband + baby) are looking to sell their house because they can't afford the mortgage due to a change in financial circumstances (not really their fault but that's for another post!).
I think that this would be a stupid idea right now unless they really are desperate.
My question is; is there anything that both myself and my parents can do to help out?
Their mortgage is about £117k and I imagine that they could probably more than comfortably afford it if they halved their mortgage costs.
Would it be in any way wise to offer to go into some sort of shared ownership with them and my parents i.e. 50% sister/husband, 25% me, 25% parents?
Obviously I'd have to ride out the dip in the market but this would leave me quids in if I do ride it out and the house prices go up? Would it be a good long term investment?
Any thoughts, or alternative recommendations?
What's the change of circumstnaces? Is it perhaps because they over borrowed?
They're in the sh t - along with thousands of others.
If you have the capital to do it and it helps your sis out then I say sure why not. So long as you get everything drawn up properly I can't see a problem with it. It's a very kind thing to do given the current market. Just don't over step the mark by demanding to stay there at will just because you have a share or suggesting how/what they should decorate etc!
Firstly, good on you for wanting to help out.
Secondly, go for it.
Providing its all done legally, and all parties can agree on values, costs, etc, then its a good investment.
You may well be a tight close family now, but God Forbid, if there are any splits in the future, these things can get messy, so do make sure its all legal.
HTH
Hoppy
Secondly, go for it.
Providing its all done legally, and all parties can agree on values, costs, etc, then its a good investment.
You may well be a tight close family now, but God Forbid, if there are any splits in the future, these things can get messy, so do make sure its all legal.
HTH
Hoppy
R4PID said:
If you have the capital to do it and it helps your sis out then I say sure why not. So long as you get everything drawn up properly I can't see a problem with it. It's a very kind thing to do given the current market. Just don't over step the mark by demanding to stay there at will just because you have a share or suggesting how/what they should decorate etc!
Just give them a loan, and have the documents drawn up properly.If you follow Soovy's advice, you'll have to be sure that you will see a return on the money you put in, and indeed on any cash that they make on the property.
If you go down the route of actualy being party to the mortgage, you will also need to be on the house deeds, unless you go as guarantor, and that in itself has pitfalls.
Could they put the Mortgage on Interest Only for a while until they get back on their feet financially.
Are they struggling with other debt as well?
If you go down the route of actualy being party to the mortgage, you will also need to be on the house deeds, unless you go as guarantor, and that in itself has pitfalls.
Could they put the Mortgage on Interest Only for a while until they get back on their feet financially.
Are they struggling with other debt as well?
Negotiate some form of equity ratchet.
I.e. the amount of cash you give them to get out of the sh*t equals a dissproportionate % amount of house.
The longer they keep your cash without paying you back the more % of house you own.
This could protect your downside if the house value continues to drop.
I.e. the amount of cash you give them to get out of the sh*t equals a dissproportionate % amount of house.
The longer they keep your cash without paying you back the more % of house you own.
This could protect your downside if the house value continues to drop.
Vesuvius 996 said:
Just give them the money each month for a bit, if you trust them.
What's the change of circumstnaces? Is it perhaps because they over borrowed?
I could give them some money but I'd probably not see if back, not that they'd not want to, just that they couldn't in the near future.What's the change of circumstnaces? Is it perhaps because they over borrowed?
They never overborrowed (well not by much!!!). The BiL was a directory in a family business, his parents *ahem* made a bad decision (read screwed him over, IMHO) and the business went bust, leaving him to go from a decent wage to a crap one.
R4PID said:
Just don't over step the mark by demanding to stay there at will just because you have a share or suggesting how/what they should decorate etc!
I would let them do what they want, no intention whatsoever of interferingHoppy2008 said:
Providing its all done legally, and all parties can agree on values, costs, etc, then its a good investment.
You may well be a tight close family now, but God Forbid, if there are any splits in the future, these things can get messy, so do make sure its all legal.
I would make sure that it's done properly, my wife studied law and works in finance so she'd make sure of that!You may well be a tight close family now, but God Forbid, if there are any splits in the future, these things can get messy, so do make sure its all legal.
DaveL485 said:
Why dont you buy the house outright and rent it back to them
I don't have the capital to put down the deposit we'd need to do that, thought about that solution thoughanonymous said:
[redacted]
All good questions and definately why I posted! I can't really answer them at the moment but will raise them if we go any further.
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