Buying Parents House Cash

[Peanut]

Hi Guys/Girls,

Been looking through this forum all day but cant seem to find any answers.
My situation is i work overseas for an american company. i have tried getting a mortgage but cannot.

My parents house is up for sale. Now what are the implecations of me carring on with the mortgage payments and also a cash sum to purchase this from my patrents ? My timescale will be roughly 8 years.


Any help or advice would be greatly apreciated.

[Enness Private Clients]

Taking over the mortgage payments is an option, but you would not be able to transfer the ownership of the property into your name - so it would have to be a family agreement, or maybe you could set up a trust?

[Paul Green]

Peanut,

I think you are talking about a number of options here - you cannot carry on paying their mortgage payment and then use a cash sum to purchase at the same time. However:

a) Mortgage payments. If your parents are based in the UK - you can take over the mortgage payments no problem - you just need a new DD and a UK based bank account. The mortgage company will not worry about this. Your parents just need to request the new mandate form and point this to your bank account

b) Cash purchase - no problem - I'd suggest you need to give the cash purchase to your parents as the deposit and take control of the property through a vehicle called a Lease Option. This needs to be done legally thru a solicator. the lease option locks your name on the deeds. Your parents can continue to live there is they like or you can rent it out and pay the outstanding amount (e.g. get a mortgage for the oustanding amount) after your 8 years. This is a very flexible tool indeed....

I hope this help.

Paul Green

Even with your parent's I'd get this done legally thru a UK solictor

[Jeannie D]

If Peanut simply took over the mortgage payments, this would eventually give him an equitable interest in the property but it would not mean that title and ownership would automatically transfer to him, so I don't think that this option is particularly helpful.

And why would Peanut want to take out a lease option on his parents' home? A lease option, as I understand it, is a device that allows someone to buy or sell something at an agreed price at an agreed time in the future. How on earth would that help either Peanut or his parents in the situation he describes? I think Enness's suggestion makes more sense.

[Paul Green]

Peanut's exact situation and requirements is unclear and you are entitled to your view Jeannie D. Agreed on the your comments on the title and ownership but that is not the question which was can Peanut take over mortgage payments and the answer is simply yes.
With regard to the option, it is an "option" for peanut and as I have said Peanut's situation is not clear.

How would this help Peanut? Well Peanut would be able to provide a cash deposit to his/her parent for their house - even without a mortgage. Peanut will then have the option to buy the house legally in future when Peanut can get a mortgage. Setting these things up is reasonably cheap - and fast.

Personally - this is my preferred view but it's Peanut's call.

Paul.