Purchasing a house with a partner V2
Discussion
Rather than highjack the other thread I have a different scenario and would be interested in views of how to go forward.
To make the maths easy just using round figures.
Me and partner buying property for say £400k we are splitting the cost 50/50. I have cash of £200k, she has cash of £50k, but she is on a 6 figure salary whilst I am on a pension (early retirement)but asset rich
Property in joint names so by default any mortgage also in joint names. Original idea was me to put in the £200k and then she pays the mortgage on the remaining £200k.
Now am wondering whether it would be 'better' to jointly put £100k towards it and the remaining £300k is a joint mortgage. say this were to cost £2k per month then I would fund it monthly from my residual £150k (£200k-£50k deposit)
The downside of me putting £200k in upfront is I suppose the initial inbalance and if everything were to go t**s up then potentially I may loose some of my capital. On the otherhand on a fixed income with the second scenario if mortgage rates were to go up significantly during the term I may struggle being on a fixed-ish income
What are your views
To make the maths easy just using round figures.
Me and partner buying property for say £400k we are splitting the cost 50/50. I have cash of £200k, she has cash of £50k, but she is on a 6 figure salary whilst I am on a pension (early retirement)but asset rich
Property in joint names so by default any mortgage also in joint names. Original idea was me to put in the £200k and then she pays the mortgage on the remaining £200k.
Now am wondering whether it would be 'better' to jointly put £100k towards it and the remaining £300k is a joint mortgage. say this were to cost £2k per month then I would fund it monthly from my residual £150k (£200k-£50k deposit)
The downside of me putting £200k in upfront is I suppose the initial inbalance and if everything were to go t**s up then potentially I may loose some of my capital. On the otherhand on a fixed income with the second scenario if mortgage rates were to go up significantly during the term I may struggle being on a fixed-ish income
What are your views
s2t said:
Rather than highjack the other thread I have a different scenario and would be interested in views of how to go forward.
To make the maths easy just using round figures.
Me and partner buying property for say £400k we are splitting the cost 50/50. I have cash of £200k, she has cash of £50k, but she is on a 6 figure salary whilst I am on a pension (early retirement)but asset rich
Property in joint names so by default any mortgage also in joint names. Original idea was me to put in the £200k and then she pays the mortgage on the remaining £200k.
Now am wondering whether it would be 'better' to jointly put £100k towards it and the remaining £300k is a joint mortgage. say this were to cost £2k per month then I would fund it monthly from my residual £150k (£200k-£50k deposit)
The downside of me putting £200k in upfront is I suppose the initial inbalance and if everything were to go t**s up then potentially I may loose some of my capital. On the otherhand on a fixed income with the second scenario if mortgage rates were to go up significantly during the term I may struggle being on a fixed-ish income
What are your views
The first issue that springs to mind is your age. Most lenders will have a maximum age.To make the maths easy just using round figures.
Me and partner buying property for say £400k we are splitting the cost 50/50. I have cash of £200k, she has cash of £50k, but she is on a 6 figure salary whilst I am on a pension (early retirement)but asset rich
Property in joint names so by default any mortgage also in joint names. Original idea was me to put in the £200k and then she pays the mortgage on the remaining £200k.
Now am wondering whether it would be 'better' to jointly put £100k towards it and the remaining £300k is a joint mortgage. say this were to cost £2k per month then I would fund it monthly from my residual £150k (£200k-£50k deposit)
The downside of me putting £200k in upfront is I suppose the initial inbalance and if everything were to go t**s up then potentially I may loose some of my capital. On the otherhand on a fixed income with the second scenario if mortgage rates were to go up significantly during the term I may struggle being on a fixed-ish income
What are your views
For example, if you are 60, Santander's maximum age is 75, therefore the maximum term you could have would be 15 years. Squeezing a £300k mortgage over 15 years is going to be pretty expensive each month......
Sarnie said:
The first issue that springs to mind is your age. Most lenders will have a maximum age.
For example, if you are 60, Santander's maximum age is 75, therefore the maximum term you could have would be 15 years. Squeezing a £300k mortgage over 15 years is going to be pretty expensive each month......
No I am in my 50's a £300k mortgage over 15 years is just over £2k per month so £1k each so over the lifetime thats £180k. So that is do-able. Maybe also relevant in that this will be our last house so not looking as it as an investment to turn at some point.For example, if you are 60, Santander's maximum age is 75, therefore the maximum term you could have would be 15 years. Squeezing a £300k mortgage over 15 years is going to be pretty expensive each month......
I guess the other aspect is that if you are co joined to the mortgage that you are still liable for any outstanding amount at any time no matter how much you have contributed at the outset, so possibly better to have a lower initial contribution and pay half the mortgage month on month, maybe also looking at an offset mortgage
I was just gauging the views as to whether if in similar circumstances you would lob in all the cash to start.
s2t said:
No I am in my 50's a £300k mortgage over 15 years is just over £2k per month so £1k each so over the lifetime thats £180k. So that is do-able. Maybe also relevant in that this will be our last house so not looking as it as an investment to turn at some point.
I guess the other aspect is that if you are co joined to the mortgage that you are still liable for any outstanding amount at any time no matter how much you have contributed at the outset, so possibly better to have a lower initial contribution and pay half the mortgage month on month, maybe also looking at an offset mortgage
I was just gauging the views as to whether if in similar circumstances you would lob in all the cash to start.
You are correct that you both be 100% liable for the full debt at all times, irrespective of how much each of you contributed to the deposit.I guess the other aspect is that if you are co joined to the mortgage that you are still liable for any outstanding amount at any time no matter how much you have contributed at the outset, so possibly better to have a lower initial contribution and pay half the mortgage month on month, maybe also looking at an offset mortgage
I was just gauging the views as to whether if in similar circumstances you would lob in all the cash to start.
I'd probably put in equal deposits and split the monthly payment down the middle, keeps things very clear and simple. If you take out an offset mortgage and lump in the rest of your cash you will both benefit from the lower payments but you'll still have access to 'your' money.
I still think you will need to clarify your ages against the lending criteria and also whether your income is acceptable. Lenders have tightened their criteria with regars to 'Lending into retirement' recently.......
An interesting situation!!
I guess the problem is, if you only put in 100k each and both get the mortgage (which you would pay from the money you have left over + your other halves contribution) then your getting stung with higher interest charges as well as other factors.
Could you not have an offset mortgage, so interest rates are reduced, the amount of interest saved is deducted off your share and as such your over half pay the remainder?
If I were in your shoes, I would look at paying off my share completely and leave your other half to sort out a mortgage on their half but get an agreement (Witnessted by a solicitor) saying that if it does go tits up, you will get back what you've put in before any other deductions are considered.
I guess the problem is, if you only put in 100k each and both get the mortgage (which you would pay from the money you have left over + your other halves contribution) then your getting stung with higher interest charges as well as other factors.
Could you not have an offset mortgage, so interest rates are reduced, the amount of interest saved is deducted off your share and as such your over half pay the remainder?
If I were in your shoes, I would look at paying off my share completely and leave your other half to sort out a mortgage on their half but get an agreement (Witnessted by a solicitor) saying that if it does go tits up, you will get back what you've put in before any other deductions are considered.
OracIe said:
An interesting situation!!
I guess the problem is, if you only put in 100k each and both get the mortgage (which you would pay from the money you have left over + your other halves contribution) then your getting stung with higher interest charges as well as other factors.
Could you not have an offset mortgage, so interest rates are reduced, the amount of interest saved is deducted off your share and as such your over half pay the remainder?
If I were in your shoes, I would look at paying off my share completely and leave your other half to sort out a mortgage on their half but get an agreement (Witnessted by a solicitor) saying that if it does go tits up, you will get back what you've put in before any other deductions are considered.
I am not sure a lender would agree to me having a first charge on the property ie ranking before them ...if I could then I would.....I guess the problem is, if you only put in 100k each and both get the mortgage (which you would pay from the money you have left over + your other halves contribution) then your getting stung with higher interest charges as well as other factors.
Could you not have an offset mortgage, so interest rates are reduced, the amount of interest saved is deducted off your share and as such your over half pay the remainder?
If I were in your shoes, I would look at paying off my share completely and leave your other half to sort out a mortgage on their half but get an agreement (Witnessted by a solicitor) saying that if it does go tits up, you will get back what you've put in before any other deductions are considered.
s2t said:
I am not sure a lender would agree to me having a first charge on the property ie ranking before them ...if I could then I would.....
The mortgage company would always be first charge.As I mentioned above, you be better off keeping it simple. Same level of deposit, 50/50 on the monthly repayments. Stick the rest of your cash in the offset account.
Sarnie said:
The mortgage company would always be first charge.
As I mentioned above, you be better off keeping it simple. Same level of deposit, 50/50 on the monthly repayments. Stick the rest of your cash in the offset account.
Thanks Sarnie that was my way of thinking and looking at your profession thanks for the inputAs I mentioned above, you be better off keeping it simple. Same level of deposit, 50/50 on the monthly repayments. Stick the rest of your cash in the offset account.
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