Property ownership

[worriedbod]

Hi I got divorced in 2000 and as part of the settlement I took over payments of the mortgage and ownership of the family home however I was self employed and so we understood that my Father was acting as gaurentor,I have recently found out that not only is the mortgage in joint name but he's on the house deeds!! I no longer live in the family home my grown up children pay board and live there I have only £11000 left to pay but at the moment cannot afford to pay it off.
If my father were to die would it transfer ownership to me ? Hes made a will but as we weren't aware he was on the deed and mortgage the house isn't included in it. He is happy to add to his will stating that he wants nothing from the house and upon his death its to be transfered to my sole name however I am concerned in the mean time until he gets round to doing this.
I also feel in a bad position as if anything happens to me who I want my children to get my property.( dads never paid the mortgage i have done it all myself)

[Peridot]

Hi Worriedbod,
Don't worry, sure it can be sorted. Just to clarify it is your father's name on the deeds and mortgage with you, is that correct?
If you hold the property as joint tenants then if anything happened to either you or your co-owner (assume your father) then the property passes automatically to the survivor of you. If you hold the property as tenants in common (you can find this out on the deeds if there is a restriction against the title) then you can 'will' your share to whoever you wish.
How long do you think it will take you to pay off the mortgage? Is your father of sound mind currently?
If you could clarify who you own the property with and how you hold it (joint tenants or tenants in common) then you can sort out what happens and what needs to be done next.

[worriedbod]

hi we just own it jointly my father and myself hes fully with it mentally ....we are over paying so should be paid off in 4 years or just over ....I just want rid of it ( the mortgage) my son wants to buy the property but as he only earns £13000 a yr not sure how .

[Peridot]

Hi Worriedbod,

There are a couple of things that you could do and I would suggest you have a look at the government website which explains the different types of co-ownership that are possible:- https://www.gov.uk/joint-property-ownership Provided your father and you are joint owners (not tenants in common) the property will automatically pass to you should he pass away. However if you are in fact tenants in common then this may not be the case. If your father doesn't have a Will currently then his assets will be divided following the intestacy rules found here: https://www.citizensadvice.org.uk/fa...-of-intestacy/

If you have established you are joint tenants then there is unlikely to be an issue as if either you or your father were to die the property will automatically pass to the survivor of you. Provided you both have Wills stating what happens to your estates in the event you pass away then when the 'survivor' of you passes away the property (or any other property should you subsequently move) will pass to whoever is named in the Will. So both you and your father could ensure the property (or it's replacement) is left to your son. Be aware however if the property passed to your father, your having passed away and he does not have a Will that deals with the property then his estate will pass under the Intestacy Rules (see link above). This may not have the intended consequences if your mother is still alive or you have surviving siblings or indeed you have more than one child. There may be some tax implications for your father as co-owner and you would both need to look into this. The fact he is a guarantor may negate this but I am not sure what information would be required to demonstrate this should the situation arise.

Are you in a position to have the mortgage (and therefore the property) transferred to your sole name, or are you still unlikely to be accepted for a mortgage in your sole name? It may be worth discussing this with your mortgage lender, particularly if you are able to demonstrate that you have been solely responsible for the mortgage since your father became the guarantor.

As far as your son purchasing the property is concerned, I would be loath to suggest that anyone should effectively 'sign over' their property to their children. I assume this is your only major asset? You would effectively be giving up any security you have for your future. In addition, there may be tax issues and in the worst case scenario if once the property was transferred you then needed care home support there could be an argument that you had intentionally deprived yourself of an asset they could have been utilised for care fees. In addition there is the seven year rule with regard to gifts made in that time before someone passes away and the possible tax implications of that.

I would strongly recommend obtaining some further advice, both on your mortgage and the position of your father as Guarantor and whether you can have his name removed at this stage and also how you can ensure the property, any replacement property or assets are then passed to the most appropriate person when the time comes.

[worriedbod]

Hi I have obtained a copy of summary of the deeds for my property it just names my dad and myself as owners and Freehold Tenure so i presume thats theres no tenancy in common in place.I have spoken to the mortgage lender and I would be unlikely to ge able to get a mortgage as i don't work ( i live with my partner in his house ) .
So if I understand you rightly if we jointly own the house then it just pass to either of us automatically if one of us dies first? having read a home will pack this is what I understood. However I have asked my dad to put this in his will when he updates it very soon that he wants it to go to me and he has no claim on the property and stateing why ( a solicitor does their wills )
I have written a letter of intent at he moment until I knew the legalities I plan to do a home will letter until my partner and I marry and then we'll do it at a solicitors.

[Peridot]

Hi Worriedbod,

Check the official copy of the register held at the Land Registry. If you are tenants in common there would be a Form A restriction in place under the Restrictions section (before the Charges section where the mortgage will be listed). If there is a restriction then you hold the property as Tenants in common and would need to deal with your respective shares by Will. If there is no restriction, then the property passes by survivorship automatically to the survivor of you and your dad.

You won't be able to deal with the property under any will, if you are a Joint Tenant. Just to clarify a letter of intent will not be considered binding. A will is the only document that could deal with it and only if you are Tenants in Common. Your dad probably needs to discuss any tax implications he may have co-owning the property with you. His solicitor should be able to advise him when he meets him to discuss the Will.

[worriedbod]

i have the form and after investingating have found that its owned as tenants in common .... is this good orbad not sure where i stand now even more anxious .

[Amethyst]

Unless it states other wise, as Tenants in Common with your Dad you own the property 50/50. This means if you passed 50% would go to your Dad and your 50% would pass as per your will. So really it's 50% better than being joint tenants. Your Dad's Will would basically have to leave his half of the house to you, as things stand it would form part of his estate and pass to wherever is currently stated in his Will (or via intestacy rules if he's yet to make one) ( Peridot will, I'm sure pop in later or tmw, just didn't want to leave you worrying overnight )

Do you have your original mortgage documents ? You'll be wanting to look into your Dad transferring his 50% to you but it will depend on the terms.

I'd certainly be putting in a full Subject Access Request to the broker and mortgage company in any case to find out exactly what product you have and how you ended up with your Dad owning half of the house rather than simply acting as a guarantor on your mortgage. See what you are able to do now to rectify matters and whether you can make any complaint if you were missold.

[worriedbod]

thanks for your reply the whole thing is a mess we understood when we did this with the solicitor that he was garentur (sp) only it was only last year we found out it was in joint names and that he was on the deeds. As long as i (we) have the house with a mortgage on it the mortgage company say he can't be taken off the deeds. The mortgage was with egg but now taken over by Yorkshire building society.
I can't talk to mum and dad as they are on holiday and whilst away their close friends been killed in a car accident. I am just over whelmed by it all and confused.

[Amethyst]

What's happened whilst they are away that's made you look at this again - is it that your Son has discussed about possibly purchasing the house ? or has the death of one of your parents friend worried you into getting this sorted asap ? ( as you have known since last year and sound a little panic'd at the minute - is there a reason for that specifically right now ? )

Your Dad's Will likely leaves everything to your Mum, and in default of that, to you ( and any siblings ) and his 'ownership' is 50% so nothing can happen without your agreement - it sounds like your relationship with your parents is okay and it was as much of a surprise to your Dad as to you, so I wouldn't worry them at the moment it seems they will have other things to contend with when they get back from holiday xxxxx Maybe for the moment concentrate on gathering information together - get subject access requests off to Egg and YBS ( and the broker that organised the mortgage if you used one which is likely, being Egg, and being self employment and guarantor requirement ) . Subject Access Request Letter Example
You should also just ask YBS direct for a copy of the mortgage agreement if you don't have a copy to hand.

Possibly also get your client file from your solicitor ?

[worriedbod]

Hi yes the sudden death has got me worried and that I believed we were joint owners,I can see that I am panickig and it can be sorted via a Will change I believe my parents have joint ownership in common on their home.
As regards the wrong info we were given or not by mortgage company I am not perusing that.all I want is my property ownership in the even of death sorting and put in place. Thanks for you advice it helps

[Amethyst]

That's understandable completely, you just want to get it sorted, and I expect your Dad will do too - it could have affected his credit file over the years, and potentially future tax liability, care home fees and so on I do think it is actually better that it's tenants in common as at very least your 50% is yours regardless.

Still I wonder how many people are in this position and don't know it

Peridot will pop in tmw anyway - try not to worry about this on top of everything else, you'll need to support your parents a little bit when they get home.

Meant to say earlier, well done getting everything sorted after your divorce and almost having the mortgage paid off (£11k is nearly !)

[worriedbod]

hi this is whats on my deeds

This is the wording its not easy to understand but does this meaning we are tenants in common (i don't know how to cut and paste from pdf sorry)I can't fine the wording tenants in common on any of me deeds.
RESTRICTION :No disposition by a sole proprietor of the registered estate(except a trust corperation)under which capital money arises is to be registerd unless autorised by an order of the court.
RESTRICTION :Except under an order of the registrar no disposition by the propietor of the land is to be registered without the consent of the proprietorof the charge dated 3rd august 2000 in favour of the egg bank refered to in the charge register.

hope this makes sence

[Amethyst]

RESTRICTION :Except under an order of the registrar no disposition by the propietor of the land is to be registered without the consent of the proprietorof the charge dated 3rd august 2000 in favour of the egg bank refered to in the charge register.

So that's the mortgage

RESTRICTION: No disposition by a sole proprietor of the registered estate (except a trust corporation) under which capital money arises is to be registered unless authorised by an order of the Registrar or the court.

.

That's Tenancy in Common

There should be a bit naming you and your dad too, and if no % listed it will be assumed 50/50 shares.

[Peridot]

Hi Worriedbod,

It is horrible when something happens that opens a can of worms like this. Please try not to worry it can all be sorted.

From the restrictions you've posted, yes it looks like you and your father are tenants in common, the first is the restriction that makes this happen the 2nd is the mortgage lenders restriction. They will have needed this as if you decided to sell the property and only had your name on the deeds this could possibly have happened and then there would be issues settling the mortgage. I suspect when your dad agreed to be guarantor it was advised that he needed some sort of interest in the property to protect not only the lender but also him, so it wasn't an incorrect decision. The only other thing may be that there is a Deed of Trust somewhere that was set up which may mean that the property isn't set up as a 50/50 but something else. Don't worry about it I'm just speculating whether as the mortgage was paid would his share in effect reduce?

It is possible to remove the restriction making you and your dad tenants in common so you would then be joint tenants and the property would pass by survivorship. Or you leave all as is and make sure you sort your wills leaving your respective shares to who you wish. Your dad particularly needs advice on this as whilst he is a co-owner the value of his share will be taken into consideration when it comes to calculating any future inheritance tax, future contribution to possible care fees, or in the unlikely event he was made bankrupt, again his share is taken into consideration. I'm only mentioning these to help your dad make sure he gets the correct advice and not to panic you.

As far as care fees and such like are concerned then it is probably best that the house is held as tenants in common as Amethyst mentioned in her post, only his share could be taken into consideration if the need arose rather than potentially the whole value of the property. There are other issues but not something to worry about at this stage. You will get this sorted out shortly through your Wills and hopefully the mortgage issue won't be around for much longer in any event after which time the restrictions can be removed and the property put into your sole name at that point.

It can all be dealt with though so take a breath and try not to worry in the meantime. You need to get your Will sorted but even this isn't a panic situation as under the intestacy rules your son would inherit your estate which includes the 50% share you currently have in the property. He would just own it with your dad. Equally if your dad doesn't currently have a will, an amount of his estate would go to your mum and the rest would be divided between his children equally. If he has a Will he may have already taken care of matters or if he leaves everything to your mum then his share of the property can still be dealt with after that but would be owned by you and your mother. As I say there may be tax implications for him so he needs to get advice on this in due course.

Speak to your dad when he's back and has had a chance to get over the holiday and other things then you can sort what needs to be done. Don't worry.