Brother buying half of my property for us to keep as a rental

[Greygirl2019]

I have been doing some reading and am struggling to find a situation similar to mine for advice.

I currently have mortgage on the home I live in, and am planning to buy with my partner. I would like to keep my house and rent it out; and my brother has expressed an interest in “buying” half of my house and we keep it long term as an investment for us both. I trust my brother to the ends of the earth, as he does me - we are close and I have no worries about doing this.

What I am confused about is how we do it so it is legal and fair. My current mortgage provider said that I’d simply apply to change my mortgage using a consent to let form, then do a transfer of title to add my brother to the mortgage and use a solicitor for the other legalities. It just seems a bit simple and I’m unsure how my brother would pay me for his half (ideally I would use what he gives me to use for the new mortgage deposit with my partner). They also said I can remortgage as joint owners but that has a hefty early exit fee as I only recently remortgaged the house. Has anyone done similar to this?! Thanks in advance.

Work out the equity and he pays you half. Put the house and mortgage in to joint names.

Assume the house is worth £300k and the mortgage is £200k. There is £100k equity. He finds £50k from somewhere and pays you that. As long as you speak to the solicitor handling the transfer and get a deed of trust done then I don't se what the complexity is.

Make sure you are tenants in common not joint tenants, that way you can leave your half to whoever you want, in the event of your death it won’t go automatically to him ( but he’d keep his half).

Be prepared to pay CGT when you sell the house that’s rented out. You will have 2 houses.

Also don't forget stamp duty on your new home will be the higher second home rate and that you will need to pay tax on the rental income not the profit after paying the mortgage. I would do all the figures before you do anything to check this is affordable.

This is a terrible idea!
1 - stamp duty on your new purchase will be 3% more than if you didn’t already own a property - so that’s 8% in total.
2 - if your DB owns half your property, if would be included if he were to divorce or die and would need to be sold.
3 - you would be responsible for half of all maintenance
4 - if he defaulted on his half of the mortgage you could lose the house.

There’s also the issue of void periods if paying a mortgage. Can you afford this? As LL of one property, it’s onerous. Labour might bring in no fault eviction. What if you need to sell but cannot evict tenant? Don’t do this. Just invest your money.