Change of name on mortgage

will1977

Hi,

I bought a house with a relation about 10 years ago. Recently got married am am buying out my relation but want to add my wifes name to the mortgage. My Relation is unemployed and has been for a while but my wife has a secure job.

I will speak to the bank but before I do I just wondered peoples opinions on what they think the chance of the bank doing it are ? Or will I be made jump through hoops ? It seems a no brainer to me for the bank to change someone who is in secure employment for someone on the dole !

Thanks

Pawwed Rig

I looked into this before.
You and your wife are effectively buying out you and your relation so will need to get the necessary mortgage approval.
A new mortgage will then be issued in both your names.
If you are currently on a tracker you will most likely lose it as it is not a product being offered by most banks anymore.

The situation I have was in was a house jointly owned by 2 people where 1 person wanted to take over the whole mortgage as the other was in financial distress. The consequences due to moving from a .8% tracker to the standard variable scuppered the deal.

will1977

I was afraid of that. My wife has her own home that we bought before we were married that is currently being rented but is in negative equity. Im unsure whether if we start the process of applying for a new mortgage, we would be approved. I knew it couldn't be as simple as just changing a name !!

The_Morrigan

Is there a reason why you want to add her to the mortgage?

will1977

She's my wife ! Do you think it would be easier to just take my relations name off the mortgage and just leave me on it ?

Pawwed Rig

will1977 wrote: »

She's my wife ! Do you think it would be easier to just take my relations name off the mortgage and just leave me on it ?

You would be assessed on the outstanding mortgage ie would you be given that amount were you to apply for a mortgage on your own? Also there will be a valuation done to assess the LTV

3DataModem

will1977 wrote: »

She's my wife ! Do you think it would be easier to just take my relations name off the mortgage and just leave me on it ?

That won't be easy either. The bank definitely won't be interested in taking your relation off the mortgage unless you apply for a mortgage in your sole name. Why would they? They lose the ability to chase down your relative in the event of default.

This is a complex situation OP. The "cheapest" solution is to leave things as they are. But if either you or your relative dies, things become super complicated.

The_Morrigan

will1977 wrote: »

She's my wife ! Do you think it would be easier to just take my relations name off the mortgage and just leave me on it ?

These days I don't see the benefit of putting her name on the mortgage, that's all. The bank won't change any names, they will make you do a remortgage/new application - it is the same process that Paww outlined already.

The_Morrigan

3DataModem wrote: »

This is a complex situation OP. The "cheapest" solution is to leave things as they are. But if either you or your relative dies, things become super complicated.

On this complication...go to a solicitor and find out what kind of mortgage/title there is. I know there is a joint tenant and tenant in common category.
You need to be able to leave your share of the house to your spouse in the event of death, however, for joint tenancy the asset passes (with mortgage paid off from the life assurance) to the survivors, in this case your relative.
Make sure you have a will in place to leave your share to your wife too - make it all nice and clear, things tend to get messy where property and relations co-exist.

valleyoftheunos

Its not possible to "Change" or remove names on a mortgage. You can only get rid of the existing mortgage and then take out a new mortgage in either your name or your's and your wife's. To do what you're hoping you will need to qualify for a new mortgage.

will1977

Thanks for the replies. I really just want her name off as very complicated at the moment with my family living in the house and spending money on upgrades etc. She has accepted an offer from me and she also want her name off so she can apply for some social welfare payments.

Would doubt the bank would give me a fresh mortgage in the situation we are in as have a few properties ( even though all mortgages are paid in full and on time ) I wonder is there a legal document that I might be able to get where my relation legally relinquishes all claims to the house ?

Looking at it logically, it dose seem stupid that the bank would not be willing to replace someone on the dole with someone who is earning 60,000 a year. Surely there is less chance of a default.

Pawwed Rig

will1977 wrote: »

Would doubt the bank would give me a fresh mortgage in the situation we are in as have a few properties ( even though all mortgages are paid in full and on time ) I wonder is there a legal document that I might be able to get where my relation legally relinquishes all claims to the house ?

It is the banks claim on the house that is the issue rather than your relatives. If there is equity in the house then your relative can assign that to you no problem (with just a legal agreement). The money owed to the bank is another matter.
Go chat with your bank would be my best advice for you.

The_Morrigan

will1977 wrote: »

Thanks for the replies. I really just want her name off as very complicated at the moment with my family living in the house and spending money on upgrades etc. She has accepted an offer from me and she also want her name off so she can apply for some social welfare payments.

Would doubt the bank would give me a fresh mortgage in the situation we are in as have a few properties ( even though all mortgages are paid in full and on time ) I wonder is there a legal document that I might be able to get where my relation legally relinquishes all claims to the house ?

Looking at it logically, it dose seem stupid that the bank would not be willing to replace someone on the dole with someone who is earning 60,000 a year. Surely there is less chance of a default.

Logic goes out the window here I'm afraid, and you have a lot more to lose if you approach the bank to do a rejig of the mortgage. If you have a tracker I'd be hesitant to do anything with that mortgage, and just leave well enough alone.

As for the relative relinquishing her claim - go to a solr, noone here can give you legal advice. To be honest, if you have a few properties and you are now married you need to sit down with a solr and both of you need to draw up wills.

3DataModem

will1977 wrote: »

Looking at it logically, it dose seem stupid that the bank would not be willing to replace someone on the dole with someone who is earning 60,000 a year. Surely there is less chance of a default.

Nope. The person earning 60k a year has negative equity, and is married to the other owner. With married couples it's "one default, both defaults". They already get the benefit of her money coming in as she's married to you.

If I was the bank I'd keep the other party tied to the mortgage. They have nothing to gain by removing her, except possibly another 4% a year in interest...

will1977

3DataModem wrote: »

Nope. The person earning 60k a year has negative equity, and is married to the other owner. With married couples it's "one default, both defaults". They already get the benefit of her money coming in as she's married to you.

If I was the bank I'd keep the other party tied to the mortgage. They have nothing to gain by removing her, except possibly another 4% a year in interest...

I don't follow that argument. How can the bank be better off having a persons name on a mortgage who currently lives on 188eur a week social welfare against a person who earns 60,000 a year

The_Morrigan

will1977 wrote: »

I don't follow that argument. How can the bank be better off having a persons name on a mortgage who currently lives on 188eur a week social welfare against a person who earns 60,000 a year

Because the person on 188 per week doesn't have another mortgage that can be defaulted on causing all the banks to scramble to get the most out of the dwindling assets.

Pawwed Rig

It is impossible to know without looking at the figures in detail ie Have you children? how much exactly does your wife earn? What are her expenses/assets? What assets does your relative have? Have they any capital?* etc etc etc. It may turn out that it would be better for the bank or it may not. It will also depend on the house we are discussing. Is there equity on it. What is the neg equity. What risk level are you?
Only your bank can determine this based on the documentation you provide.
€188 with no expenses/liabilities is a better situation than €60,000 with €70,000 expenses.

*not asking you to disclose this but giving an example of information the bank would require

3DataModem

will1977 wrote: »

I don't follow that argument. How can the bank be better off having a persons name on a mortgage who currently lives on 188eur a week social welfare against a person who earns 60,000 a year

Here are the possible outcomes for the bank;
1. You pay the mortgage
2. You are unable to pay the mortgage

And lets look at 3 scenarios;
A. You alone on mortgage
B. You and wife on mortgage
C. You and cousin on mortgage

Q: Do you think that 2 is more likely in scenario A or C
Hint: It's A, obviously.

Q: Do you think that 2 is more likely in scenario A or B?
Hint: It's the same. If you can't pay and you are living there, your wife will pay, even if her name isn't on it.

Therefore;
C > B and B = A from the banks perspective