Mortgage Being Allowed

[chrissa1]

My daughter and son-in-law have offered to me the option of moving in with them when they buy a bigger house in a couple of years time. Ideally the house would be a four/five bedroom home with an annexe option for me.

My question is, would a mortgage company be happy to consider a bigger mortgage, bearing in mind that their income would be augmented per month by my contribution of say, £400/month?

[ubasses]

Firstly I am a few years retired, but they will probably need a specialist Mortgage Broker. There are so many questions, is the annexe attached or separate?, if you are paying a contribution it could be seen as rent and it might have to be part ordinary mortgage, part buy to let mortgage. How would the property be owned, joint tenancy of all of you, or split into tenants in common. They might require you on the mortgage if income requirement is not met and then your age will come into play.
Probably a few more questions I cannot think of at the moment. Hopefully someone still employed will be able to give you a more up to date reply.

[AuntPollyGrey]

If you are selling your home to move in with them, the easiest option would be to give them a lump sum from the sale of your property so their deposit would be bigger, thus their mortgage repayments smaller. I would not even tell any mortgage company what you are going to do as it will complicate matters and your daughter and SIL would not get the best of deals.

[chrissa1]

I am currently renting since my husband died in 2011. Thanks for your input.

[Buenchico]

Lenders always work with "what if?" scenarios. I could see a mortgage manager (or, more likely, the computer algorithm that he/she uses to determine whether a loan can be advanced) thinking along the lines of "What if the lady who's moving in with this couple were to die? How would they maintain their increased mortgage payments then?"

Further, as you wouldn't own a share of the property which formed the security for the loan, the lender would probably regard your £400 per month as, in effect, 'paying rent'. Lenders often have different rules (and frequently higher interest rates) when mortgaged properties are being used to obtain a rental income.

So, my own feeling is (regrettably) that the lender wouldn't be prepared to 'play ball' with your suggestion. However it might still be worth your daughter and son-in-law making a tentative enquiry to the lender.

[johnk]

I would also think of a way to protect your input if the couple split. I've seen so many parents lose money to the other half of a divorce.