Taking over half a mortgage...

[revs88]

Hi Guys,

I'm considering taking over half my partners mortgage with the aim that half the capital is removed from her side of the debt and I own half the property from a deeds perspective.

What's the most cost effective way of doing this? Will I need to pay stamp duty?

Any advice would be greatly appreciated.

Cheers, Richard

[Steffan]

revs88 said:

Hi Guys,

I'm considering taking over half my partners mortgage with the aim that half the capital is removed from her side of the debt and I own half the property from a deeds perspective.

What's the most cost effective way of doing this? Will I need to pay stamp duty?

Any advice would be greatly appreciated.

Cheers, Richard

Not an easy thing to do.

Joint and several liability is the problem.

If you become an additional party to the mortgage you are BOTH liable for the FULL AMOUNT.

You cannot take over your partners liability there will still be one mortgage with BOTH partners liable for the whole amount. Jointly and Severally.

Joint and Several liability is a very English concept now adopted in much of the financial world.

Stamp Duty is not a problem. There is no sale unless your partner sells you the whole house but clearly that is not what you want. No sale = No Stamp Duty.

I would ask the lender what costs would be involved in your being added to the loan as another borrower. Should be the cheapest option.

But with Lenders as they are currently they are tending to charge top end fees for any changes to mortgages.

This will make you both equal owners and both liable for the whole mortgage.

[Steffan]

You might also consider remortgaging the property as a Joint Mortgage with a new lender. However I think will be more difficult and more expensive. And this might just raise the question of a sale, or partial sale, by the current owner, which could possibly attract Stamp Duty.

The Revenue might regard the first sale as a disposal by your partner I would consult the stamp Duty Office. I doubt it would but the Revenue at the Stamp Duty Office are very disposal alert.