transfer of equity - a bit of help please!

[Nataly 38]

Ok.. First off, property and mortgage rules are VERY different over here, so I'm not looking for advice on the logistics of it.. Merely some ideas on how to apply pressure or negotiate..

Here's the situation..

We are trying to transfer a house jointly bought in his and my name to his name only. We started this process with our mortgage lender in 2008. We have finally, finally, finally gotten an answer from them, and in order to have the mortgage in his name only, they want him to put down a further £68,000.00 as a downpayment. Note the house is NOT in negative equity, and the current mortgage is still less than the total (current) value of the property.

Part of the problem in the first place is that in the 20 or so months that they have fucked us around by not dealing with our case, the property market went down drastically (although it's been on the rise now for over 6 months).

He is able to pay off the current mortgage on his own - he has been doing so for one year now.

So.. Anyone got any ideas how we can negotiate?? I think they're being pretty fucking unreasonable..

"There is no problem so bad you can't make it worse."
- Chris Hadfield
« Sors le martinet et flagelle toi indigne contrôleuse de gestion. »
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[Remster 24]

I forgot how the mortgage rules work over there, so some of this may not be applicable, but:

How portable are mortgages? Could you close this one, and open a new mortgage with a competitor (say, you are with lloyds, get an appointment with Barclays, see what they have to offer, get an offer, and then go back to Lloyds and see if they can match it). There may be early close penalties, so you;ll have to do the math to see if its worth it.

Remster

[Nataly 38]

Yes, we looked into that as an option.. The other mortgage lenders are asking for a large downpayment, and add the penalty and solicitor fees & the damage is roughly the same.

Cash-flow-wise, it's not viable (although we're still trying with different lenders).

"There is no problem so bad you can't make it worse."
- Chris Hadfield
« Sors le martinet et flagelle toi indigne contrôleuse de gestion. »
- my boss

[freeatlast 0]

Hi Nataly

Unless you can prove that the delay or some action (or lack of) effectively caused the subsequent delay and effective decrease in value to the property i think that you are not going to get anything from the mortgage company.

Could he not effectively buy your share of the property from you? - Although this would still not remove you from liablity if the mortgage were to default ...

Or if it is because you want to buy a property could he not give you the £68000 toward your deposit and you draw up an agreement effectively re-nouncing your claim on the joint property when it is eventually sold?

To be fair none of these situations are ideal but i'd hate having to give the mortgage company £68000 just to transfer the property!!!

[Squeak 17]

Quote

Yes, we looked into that as an option.. The other mortgage lenders are asking for a large downpayment, and add the penalty and solicitor fees & the damage is roughly the same.

Cash-flow-wise, it's not viable (although we're still trying with different lenders).

really, they should stake you the loan based on the capital value of the house. if the value of the place is more than 20% higher than the monies being borrowed they ussualy dont require a down payment.

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[shropshire 0]

CAVEAT : Simple person logic here -

Sell the house, pay the bills/tax etc.. and split the remainder.


P.S He could be the buyer.

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[jumpwally 0]

Or move in, take a room for yourself and pay yourself rent while wating for the market to improve,,,,

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[SkyDekker 1,135]

Quote

So.. Anyone got any ideas how we can negotiate?? I think they're being pretty fucking unreasonable..

The only thing you haven't really mentioned is his credit history. based on the fact that they are asking for additional down payment, and that other banks are asking for a sizeable downpayment, leads me to believe that he might not have a great credit history.

If that is the case, there is little you can do.

[Andy9o8 0]

The following is not legal advice - speak to your own solicitor for legal advice

The mortgage was underwritten based upon risk assessment guidelines, taking into account (a) 2 income sources, (b) 2 credit histories, and (c) 2 borrowers who will be jointly and severally liable for the debt. With you out of the mix, it morphs into a riskier loan for the lender; thus, it's not unreasonable for the lender to require a higher down payment (and maybe higher monthly payments, too) to offset the increased risk.

Essentially, your ex is trying to re-finance the mortgage, but as a sole individual, and not as one-half of a couple - and as you've found out, whether it's from the current lender or a different one, the loan underwriting guidelines are basically the same, with basically the same result.

I don't think you or he have any further negotiating leverage with the lender. You're facing the same problem that many divorcing (or equivalent) ex-couples face, especially when the house has reduced in price since it was closed-on some years ago. Your choices really are for him to either re-fi the house in his name alone and live with the enhanced down payment, or surrender to the reality of the situation and sell out to a third party.

[Nataly 38]

Quote

CAVEAT : Simple person logic here -

Sell the house, pay the bills/tax etc.. and split the remainder.


P.S He could be the buyer.

We looked into that option as well, but by the time all the admin fees are payed off, we would only just about break-even on the loan, but not recover our initial investments (which was rather sizeable). In short, we wouldn't lose *more* money, but we would lose what we've already invested.

By the way, his credit history is impeccable.. It's rather that they are assessing the risk on the basis of his salary. They refuse to consider his other sources of income, which include rent money on this and his other property. On this basis, there are lenders who would take him on by himself, however changing mortgage lenders would mean a big penalty and admin fees, effectively making it unfeasible as well.

I find it illogical that in November, he was offered an 85% loan to value mortgage, and now it's something more like 70%.. The property market has improved and he has gotten a pay rise in the meantime!! Doesn't make sense to me at all..

They either changed their policies or they're being deliberately difficult because they simply don't want me removed from the mortgage.

"There is no problem so bad you can't make it worse."
- Chris Hadfield
« Sors le martinet et flagelle toi indigne contrôleuse de gestion. »
- my boss