legal advise re mortgage and claiming a house

[the-norseman]

Hi all,

Very quick question which will probably be followed up by a lot more questions.

If a person or people borrow money against somebody else's house (a relation of the borrower) and get their name on the mortgage/deeds for that house, do they then have a claim to ownership of the house later on down the line?

There is a hell of a lot more detail I could pump in to this question but wanted to keep it simple for now.

[Jeremy-75qq8]

the-norseman said:

Hi all,

Very quick question which will probably be followed up by a lot more questions.

If a person or people borrow money against somebody else's house (a relation of the borrower) and get their name on the mortgage/deeds for that house, do they then have a claim to ownership of the house later on down the line?

There is a hell of a lot more detail I could pump in to this question but wanted to keep it simple for now.

They don't get rights.

This is called third party security where the security is not that of the borrower.

Most lenders shy away from this as it is fraught with pitfalls.

Another was of doing this is for the lender to ask the third party to guarantee the loan and for the guarantee to be supported by security ( the house).

Unless there is a good reason for it if you are the person providing security run a mile.

Banks don't like it as when it goes wrong the person who put up the security immediately says they were subject to undue influence and then deny they understood theu Could loose their house.

[Nickp82]

Jeremy-75qq8 said:

Could loose their house.

Hoots man!

[TooLateForAName]

the-norseman said:

Hi all,

Very quick question which will probably be followed up by a lot more questions.

If a person or people borrow money against somebody else's house (a relation of the borrower) and get their name on the mortgage/deeds for that house, do they then have a claim to ownership of the house later on down the line?

There is a hell of a lot more detail I could pump in to this question but wanted to keep it simple for now.

Thats not very clear to me.

Someone borrowed against someone else's house?

So person A borrowed money using person B's house?

Person A took out a mortgage against person B house?

A joint mortgage by A &B where A took the money and the house belongs to B?

mortage and deeds are different things, so did A get put on the deeds? in what capacity?

[the-norseman]

So person A (the borrower) is my uncles wife borrowing on behalf of my uncle , she at the time was uncles partner though not wife. Person B (the house owner) is my grandad who at the time was mortgage free.

I think they have borrowed the money against the house by taking out a new mortgage which I'm guessing was a joint mortgage , but my uncle/his partner took all of the borrowed money.

I'm trying to establish some info from the outside before I go wading in.

[Panamax]

The only person who can grant a charge/mortgage over a house is the legal owner. Who the recipient of the cash may be and what they do with the money makes no difference. If the bank enforces their security due to non payment it's the property owner who will lose out. Whatever has been done with the cash, the recipient of the cash gets no automatic rights over the house.

If you flip this the other way round and somebody else "guarantees" your mortgage they are on the hook if you fail to pay. Their guarantee may well be secured against their own house. Someone who guarantees your mortgage is simply on the hook for cash if you fail to pay and their house may be at risk. They don't get any rights over your house.

[hidetheelephants]

the-norseman said:

Hi all,

Very quick question which will probably be followed up by a lot more questions.

If a person or people borrow money against somebody else's house (a relation of the borrower) and get their name on the mortgage/deeds for that house, do they then have a claim to ownership of the house later on down the line?

There is a hell of a lot more detail I could pump in to this question but wanted to keep it simple for now.

No, but the bank/lender certainly does if the payments aren't kept up.

[K4sper]

Do you mean your grandad borrowed money (from a bank / building society?) who took a mortgage over your grandad's house, and your grandad gave all the proceeds of the loan to your uncle? In which case, see posts above and note that it's almost certain that this gives your uncle no rights to the house and also no obligation to the lender to repay the loan. There may (hopefully) be a private arrangement between your grandad and your uncle about how the loan is repaid.

I'm struggling to understand what you mean by your uncle and his wife having ended up on the deeds and/or the mortgage? that suggests that the house (or part of it) has been transferred to them by your grandad?

[the-norseman]

Panamax said:

The only person who can grant a charge/mortgage over a house is the legal owner. Who the recipient of the cash may be and what they do with the money makes no difference. If the bank enforces their security due to non payment it's the property owner who will lose out. Whatever has been done with the cash, the recipient of the cash gets no automatic rights over the house.

If you flip this the other way round and somebody else "guarantees" your mortgage they are on the hook if you fail to pay. Their guarantee may well be secured against their own house. Someone who guarantees your mortgage is simply on the hook for cash if you fail to pay and their house may be at risk. They don't get any rights over your house.

From what I can gather my grandad has been pressured into agreeing to this joint mortgage with my uncles partner, grandad is now 86 dementia starting to set in. Hes fallen out with them over it, they are literally waiting for him to pop so they can swoop in and collect the house.

He has contacted a solicitor over it, I believe the solicitor has sent letters asked for them to agree to being taken off the deeds but they have ignored them, next stage is court but at 86 grandad doesn't want to do that.

Edited by the-norseman on Saturday 27th January 11:22

[hidetheelephants]

What is described may be economic coercion/abuse, it became a crime not that long ago.

[Panamax]

the-norseman said:

From what I can gather my grandad has been pressured into agreeing to this joint mortgage with my uncles partner, grandad is now 86 dementia starting to set in. He's fallen out with them over it, they are literally waiting for him to pop so they can swoop in and collect the house.

He has contacted a solicitor over it, I believe the solicitor has sent letters asked for them to agree to being taken off the deeds but they have ignored them, next stage is court but at 86 grandad doesn't want to do that.

TBH none of this seems to be making any sense. If he's put the house into joint ownership that's a completely different kettle of fish than just mortgage arrangements.

If you're hearing everything second hand you need to get some accurate information, and you can do that very easily on your own. If you use the link below you can simply input the property address and get a copy of grandad's legal Title from the Land Registry online for £3. It'll tell you (a) who owns the house (Proprietorship register), and (b) what mortgages (Charges register) are in place.
https://search-property-information.service.gov.uk...

(DON'T use any other websites. You'll just be contacting a middle man who'll charge you £30 to get exactly the same information on your behalf. Completely unnecessary.)

[the-norseman]

I've just done the £3 document and as expected it shows my grandad and my uncles wife.

Initially it shows what I expect is my grandad buying it off the council in 2002 and then there is mention of a mortgage company in 2016 and her name appears.

They hid all of this from my dad when it happened as my dad used to do all of grandad's finance stuff, Dad found out eventually and found out all of the details but unfortunately hes now passed away.

I just down want to see my uncle/wife steal what isn't really theirs, fair enough if he wanted to leave it to them but he doesn't hence why he has fallen out with them. The original plan was for the house to be left to his 4 sons (mum would get dads share now). Dad also had a suspicion that she has done this before as she has been married twice.

Edited by the-norseman on Saturday 27th January 14:29

Edited by the-norseman on Saturday 27th January 14:40

[Panamax]

the-norseman said:

I've just done the £3 document

Good start.

the-norseman said:

as expected it shows my grandad and my uncles wife.

Presumably you mean shown as joint owners in the Proprietorship register from 2016. That's quite a while back so it's likely to be hard to argue he was mentally incapable at that time.

When a house is jointly owned the ownership might be truly "joint", in which case the house passes immediately to the survivor when the first person dies. Alternatively it's possible the house is owned "in common" through a separate trust document. That separate document would govern what happens on death and doesn't appear at the Land Registry. However, if such a document does it exist you will be able to tell from the search you have already made.
Download the Title from the Land Registry (which you have already done). If under Section B: Charges, it shows something like "there is a Form A restriction" then they are "in common". If there's no restriction shown, then they are "Joint."

the-norseman said:

there is mention of a mortgage company in 2016 and her name appears.

I anticipate he was too old to get a mortgage on his own and her name needed to be added to supposedly provide additional security for the bank.

the-norseman said:

They hid all of this from my dad when it happened as my dad used to do all of grandad's finance stuff, Dad found out eventually and found out all of the details but unfortunately he's now passed away.

Well, if grandad was of sound mind he was entitled to do whatever he wanted with his stuff without involving your dad.

the-norseman said:

I just don't want to see my uncle/wife steal what isn't really theirs, fair enough if he wanted to leave it to them but he doesn't hence why he has fallen out with them. The original plan was for the house to be left to his 4 sons (mum would get dads share now). Dad also had a suspicion that she has done this before as she has been married twice.

That all sounds a difficult family can of worms with which I'm unable to assist. At the end of the day what's done is done. All he can do now is adjust his Will to leave his estate in whatever way he chooses.

As you will have spotted, the real questions here come back to

• is their joint ownership "joint" or "in common"? and
• if it's "in common", what are the terms of that arrangement?

[the-norseman]

Panamax said:

Thanks for the reply, section B has 5 entries.

I dont see a restriction A form though, just two restrictions.

[Panamax]

the-norseman said:

just two restrictions.

Presumably one for the first mortgage and one for the second mortgage? You should see the name(s) of the bank(s) if that's the case.

[the-norseman]

Panamax said:

Presumably one for the first mortgage and one for the second mortgage? You should see the name(s) of the bank(s) if that's the case.

B1 is the owners
B2 is the price paid in 2002 - think that is when it was purchased off the council

B3 "RESTRICTION: No disposition by a sole proprietor of the registered estate (except a trust corporation) under which capital money arises is to
be registered unless authorised by an order of the court.

B4 The Transfer to the proprietor contains a covenant to observe and perform the covenants referred to in the Charges Register and of indemnity in respect
thereof.

B5 RESTRICTION: No disposition of the registered estate by the proprietor of the registered estate is to be registered without a written consent signed
by the proprietor for the time being of the Charge dated 22 August 2008 in favour of XXXX Mortgage Company Limited referred to in the
Charges Register.

[Saleen836]

It has not been mentioned yet but who has/is paying the repayments for the remortgage that was taken?

[the-norseman]

Saleen836 said:

It has not been mentioned yet but who has/is paying the repayments for the remortgage that was taken?

So my uncle/his wife were paying them but they stopped all of a sudden which is when the arguments broke out, I'm guessing either grandad is now paying it via pension or something, I will have to find that out.

[QuickQuack]

the-norseman said:

Panamax said:

Presumably one for the first mortgage and one for the second mortgage? You should see the name(s) of the bank(s) if that's the case.

B1 is the owners
B2 is the price paid in 2002 - think that is when it was purchased off the council

B3 "RESTRICTION: No disposition by a sole proprietor of the registered estate (except a trust corporation) under which capital money arises is to
be registered unless authorised by an order of the court.

B4 The Transfer to the proprietor contains a covenant to observe and perform the covenants referred to in the Charges Register and of indemnity in respect
thereof.

B5 RESTRICTION: No disposition of the registered estate by the proprietor of the registered estate is to be registered without a written consent signed
by the proprietor for the time being of the Charge dated 22 August 2008 in favour of XXXX Mortgage Company Limited referred to in the
Charges Register.

Looks like the property is held as joint tenants rather than tenants in common. Joint tenants means both own 100% of the property, when one dies, the other becomes sole owner, neither owner can bequeath their share in a will as they don't own a defined share - the other party owns the whole as much as they do. Tenants in common means that every party owns a defined share according to a trust agreement could be 50%-50% split, it could be a 1%-99% split, or it could be multiple parties each owning different percentages. Each ownership is defined and each owner can do as they like with their share.

If ownership isn't restricted as above with a Form A or another document, it's likely that it's owned as joint tenants by your grandfather and uncle's wife, and she will become sole owner upon his death. That is, unless a joint tenancy is nullified and replaced with a tenants in common structure with defined percentages. It's not difficult to do, but both parties need to agree to it. That's the only way someone other than your uncle's wife can inherit the property when your grandfather dies.

It's a very messy situation to be in, I'm so sorry that there don't seem to be any easy answers or solutions.

[the-norseman]

QuickQuack said:

It's a very messy situation to be in, I'm so sorry that there don't seem to be any easy answers or solutions.

Yep it is, thank you very much for your help.

It seems she knew what she was doing which leads me to believe dads thoughts on that she has done this before.