Guarantor Query

Rooskey

My girlfriend is currently thinking about buying a house. I own my own house and have most of the mortgage paid off on it. I was wondering if it would be possible for me to act as a guarantor for her?

Victor

You could, but make sure that you have it written up properly that if things go wrong, you won't get stung.

Can you afford two payments if she can't pay?

The_Conductor

Rooskey wrote:

My girlfriend is currently thinking about buying a house. I own my own house and have most of the mortgage paid off on it. I was wondering if it would be possible for me to act as a guarantor for her?

You capacity to make repayments on her behalf, should she be unable to do so, is what would be measured (along with your offering suitable equity to guarantee her, should it need to be called upon). Its not simply putting up an asset- your monthly outgoings must be sufficient to support her mortgage, if need be.

Victor

Oh, assuming you guys have roofs over your heads, do you need to dip into an uncertain property market?

ciano6

Victor wrote: »

Oh, assuming you guys have roofs over your heads, do you need to dip into an uncertain property market?

+1
If you guys are going to stay together then why buy another house during what could (will) be an incredible downturn?
If on the other hand, she's buying on the off-chance that you guys break up, then you'd be mad to go guarantee her loan.
Either way, it makes no sense to me. Is there anyone else who might guarantee for her.
When my Dad covered me, we made it clear to the bank manager that it was only for a year. 12 months later, I got his name taken off. In the current climate, that mightn't be possible but you should try it, if you still think buying is wise.
Good Luck

Rooskey

Thanks for all your replies.

The house I own is down the country and both of us are working in Dublin. Hence the reason why she is looking at buying up here.

antoinolachtnai

You probably could be a guarantor, but why would you do this? You would not necessarily have a good claim on the house were the other person not to make the payments for any reason. It's all risk for you, with no prospect of an upside.

It would probably make more sense to buy together in some way. You could borrow on the strength of your own home to get a sizeable deposit. You would then own a proportion of the house, though she might have the option to buy you out at a later stage.

If you were living in the house, and you owned less than half, then you would need to pay the other party some rent.

You do need to talk to a solicitor about this, and you also need to be creative about the financing.

Property market is certainly a bit funky, but if you need somewhere to live then you may be able to get the right deal.

johnnyskeleton

antoinolachtnai wrote: »

You probably could be a guarantor, but why would you do this? You would not necessarily have a good claim on the house were the other person not to make the payments for any reason. It's all risk for you, with no prospect of an upside.

It would probably make more sense to buy together in some way. You could borrow on the strength of your own home to get a sizeable deposit. You would then own a proportion of the house, though she might have the option to buy you out at a later stage.

If you were living in the house, and you owned less than half, then you would need to pay the other party some rent.

You do need to talk to a solicitor about this, and you also need to be creative about the financing.

Property market is certainly a bit funky, but if you need somewhere to live then you may be able to get the right deal.

+1.

There is no benefit to you in going guarantor to her, and there is a lot of risk. It's that simple. These things have a way of going wrong, which you probably couldn't even begin to imagine now, so all the more reason for caution.

I would suggest that going guarantor should only be done for a member of your immediate family or your lawful spouse.