Buying a property - Mortgage and cash

Kalada

Registered User
Messages
12
Hi,

My partner and I are not married and we just got a property. She has a mortgage approval on her own and I have cash to cover the other half. The idea is that we will go 50%-50% with the property.

What's is the best action to take financial wise? Is there anything we should consider?

Thanks,
 

Brendan Burgess

Founder
Messages
38,710
You should do an agreement setting out the percentage ownership.

Do that now. It will be too late to do it if you split up.

The agreement should state that
1) You own half the house
2) She owns half the house
3) The mortgage is her entire responsibility and any balance on the mortgage will be deducted from her half of the sales proceeds
4) If either of you want to sell the house, you will give 3 months' notice of putting it on the market and that you appoint X as the arbiter in any dispute.

Brendan
 

Kalada

Registered User
Messages
12
Thanks Brendan.

Apart of the co-ownership agreement, how are we supposed to complete the payment? As she is mortgage approval, she is "supposed" to complete the payment of the whole property however we are 2 people paying the property.

Thanks
 

Brendan Burgess

Founder
Messages
38,710
I don't see the problem.

You will both go on the title deeds and both on the mortgage.

So you are like any other couple buying a house for €200k with a €100k mortgage and €100k deposit.

Brendan
 

Kalada

Registered User
Messages
12
But the mortgage is not in my name. So basically the house will be in both names but the mortgage on her name only.
 

Brendan Burgess

Founder
Messages
38,710
No, the mortgage will be in both your names.

The lender will not give a mortgage to her unless she owns the property outright.

That is why you need to do an agreement.

Brendan
 

Kalada

Registered User
Messages
12
Ok. The mortgage approval is in her name only. Is this wrong if I want to co-owner the property with her?

Basically we want to pay the property both of us together but I will cover my half part by cash and her mortgage hers. At the same time, I understand that we need to do an agreement.

Thank you!
 

Brendan Burgess

Founder
Messages
38,710
I think you will need to get approval for a joint application.

I presume that approval was for purchasing on her own.

Brendan
 

Alkers86

Registered User
Messages
69
You should do an agreement setting out the percentage ownership.

Do that now. It will be too late to do it if you split up.

The agreement should state that
1) You own half the house
2) She owns half the house
3) The mortgage is her entire responsibility and any balance on the mortgage will be deducted from her half of the sales proceeds
4) If either of you want to sell the house, you will give 3 months' notice of putting it on the market and that you appoint X as the arbiter in any dispute.

Brendan
Also consider ongoing maintenance, upgrades etc. Probably easiest if these are all split 50:50 also.
 

Kalada

Registered User
Messages
12
I think you will need to get approval for a joint application.

I presume that approval was for purchasing on her own.

Brendan

Yes, mortgage approval to purchase on her own.

As we want the property to be in both names, the joint agreement I believe it is what we would need?

Solicitor said that I can't co-owner the property with her as the mortgage is not in my name and we are not married. To be honest, this doesn't make too much sense to me.
 

cremeegg

Frequent Poster
Messages
3,090
There are two separate things here.

Who owns the property, who has the mortgage.

So you own the property 50/50 and she has a mortgage for her 50% and you have no mortgage for your 50% because you paid cash.

However no bank would give her a mortgage on this basis, that has nothing to do with the mortgage approval, it has to do with the banks security. The bank wants a claim on the entire house, a claim on 50% of a house is meaningless, the bank cannot repossess the kitchen and one bedroom.

Solicitor said that I can't co-owner the property with her as the mortgage is not in my name and we are not married. To be honest, this doesn't make too much sense to me.
The existing mortgage approval is no good because it is for her only and you want to buy the house together.

You need to get a mortgage in both your names, with a 50% deposit and two people borrowing rather than one, this should be no trouble.
 
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