Get mortgage myself but share ownership

wylo

Hi, I am not sure whether to post this here or in the legal form. I was wondering if anyone can offer any advice and see if there is any problem with this approach...


Myself and my girlfriend would like to buy a house. She already has a large amount of money saved. However at the moment her work is unstable/self employed and will be for a while. Failing that she can get work no problem next year. But this sort of rules her out of a mortgage even though financially she is doing well.


We are looking at houses at approx €190K to €210K, we have €35K each so are willing to put 70K of our own money into it.

I am earning 40K/year.

We are considering this idea:

1. She puts money into my account, with the 70K I then get a mortgage myself of approx €140K allowing us to spend €210K.
2. Immediately after I buy the house, we go to a solicitor and I share ownership of the house with her.
3. She pays half the mortgage to me every month (she has the money)

Ideally we would like to have something even legally sorted before I get the mortgage but I dont know if thats possible. We completely trust each other obviously but are both very pragmatic in general about this kind of stuff and believe we should do out this stuff on paper legally if possible.

Is this idea possible?

Cuddlesworth

No, the bank will ask you where the other 35k came from. And then would ask you how you are going to pay back the GF and pay capital gains on the money given.

It worth pointing out, the bank owns your house. Its not yours to give half away once the sale is made, until you have paid off the mortgage.

But... you could also apply for a normal joint mortgage without trying to hide your circumstances. The banks will loan 3.5 times combined income.

40k x 3.5 = 140k + 70k deposit = 210k.

jimmycrackcorm

wylo wrote:

Myself and my girlfriend would like to buy a house. She already has a large amount of money saved. However at the moment her work is unstable/self employed and will be for a while. Failing that she can get work no problem next year. But this sort of rules her out of a mortgage even though financially she is doing well.

Your logic doesn't make sense. It's a if a married couple should not apply for a joint mortgage if one partner stays at home.

Your plan is to apply as a single applicant so is less of an advantage when you have two

rykzer

Your GF can give you a tax free gift of up to 15k

GingerLily

They can have her on the application but not include her income if it is not guaranteed.

If she gifts you the cash then you'll have to pay tax on it, I wouldn't go down that road.

cannotlogin

Leaving aside tax, gifts, breach of mortgage agreement via tranfer of ownership.....

You would be INSANE to split any asset 50/50 while the debt is split 100/0!!!!!!!

SHE gets all the BENEFIT
YOU take all the RISK

august12

Better to apply jointly, worse case scenario, they exclude her income if its not guaranteed but you still get 3.5 of your income. Joint application means all bank details from both parties to be submitted, it's pointless doing what you are suggesting and might create more problems down the line.

dubrov

Just apply for a joint mortgage. Based on the numbers you've given three shouldn't be an issue.

Just be aware that if your partner stops paying the must-have you will be liable for her half

Cuddlesworth

dubrov wrote: »

Just apply for a joint mortgage. Based on the numbers you've given three shouldn't be an issue.

Within the 3.5 times rule at the moment.
66% LTV.
First Time buyers.
History of Savings, with more money in the pot(I think).
High chance of additional income increases in future.
Mortgage payment well within affordability limits.

I'd be surprised if they got rejected.

johnnyskeleton

wylo wrote: »

2. Immediately after I buy the house, we go to a solicitor and I share ownership of the house with her.

Would you consider going to a solicitor to see if its legally possible before buying the house?

myshirt

She would have to sign a letter saying the money to you is a gift and she has no claim to the house. The bank wouldn't run with your plan either. If they did then that person would be getting the sack very, very quickly. Just apply jointly. You are overcomplicating it.

myshirt

johnnyskeleton wrote: »

Would you consider going to a solicitor to see if its legally possible before buying the house?

It's not.

GingerLily

If it were possible it would leave your girlfriend financially vulnerable also.

Apply together, easiest and most realistic solution!

pwurple

Where to start with this one.
You cannot transfer ownership of an asset that size without tax implications. You also can’t receive that 35k ‘gift’ without declaring it and looking at capital acquisitions tax. 16k is the limit for unrelated persons. You two are unrelated, Class C for CAT.



My situation is similar. Here’s what we did. We are a married couple, one working, the other not. Applied jointly, own the property together. That is the simplest way. Otherwise, you are into a mess legally and with tax.



Before you go down the route of buying assets worth hundreds of thousands of euro, protect yourselves, and each other. When you apply together, take out a joint life assurance policy also. Get married sooner if you intend doing that anyway, and apply jointly would be my advice. Then you both have some legal protection around “the family home”.

wylo

Hi all, thanks alot for the replies! I guess that clears that up . I guess I was being over-convoluted and a bit naive.

My reluctance to do the joint mortgage was I thought that the instability from her side would be seen more like a liability even though she will have money in her bank to pay the mortgage not to mention anything she does earn this year on top of that.

pwurple, just wondering what difference does it make being married?

GingerLily

We didn't find it made any difference to be married when we applied, we were originally approved before we got married and reapplied to another bank after we got married and it honestly didn't seem to make a difference to get approved.

Maybe there would have been issues at drawdown?

I personally wouldn't get married first if I was doing it again, it costs a lot and caused major issues with our approval because of the wedding expenses.