Joint mortgage

[needmorecoffee]

we're planning on getting a joint mortgage with my sister to buy my mum a bungalow. She'd being made homeless as the council waiting list is years long. Gonna be about 120k and we'll use our house as collateral.
Any advice/tips/pitfalls etc?
Good stories, bad stories?

Hi if you need any help with this can i ask you to consider looking here

See a solicitor and ensure that your home is not going to end up at risk. If the bungalow is worth the money you are paying for it, why do you need your own home as collateral?

Your mum also needs to see a (separate independent) solicitor to ensure that she has security of tenure in case you all fall out in the future. I know you may feel this is absolutely not going to happen, but the unthinkable can and does happen in families.

Are you remortgaging your home to be able to give cash towards the bungalow ? Get it all legally drawn up rewnership and deeds or you could have problems later on (tax, splitting equity etc) if you come to sell it.

the bungalow is worth the money but cos its a weird mortgage they want a guarantee. And the solicitor says not to tell anyone its for my mother as building societies are reluctant to provide mortgages for that.
Gonna have a solictor draw up something as housing benefit only covers 400 quid of the projected 700 a month costs so me and my sister will have to split that. We don't actually have any spare money for this as DH no longer works but couldn't let mum be homeless. The council would have stuck her (she's 73 with Parkinsons and angina and paranoia) in a temporary hostel with junkies and what have you. She doesn't have enough 'points' to get a warden sheltered council bungalow. Crap isn't it.
To be honest, and I feel bad about this, I'm not looking forward to being her 'carer'. I'm disabled myself and have a severely disabled daughter. Like I have time to take her to appointments.

Hate to say it but think the building society need to know - read their small print as they usually have a right to consent. Is it a buy-to-let ? Also HB may not be reliable income if you are renting from a relative, unless you have a formal agreement.

You need to look into this very carefully. Renting from a relative is something that the housing benefit people consider minutely, as it is often used as a scam to get money to which the recipient may not be entitled. There is no guarantee that she will get any housing benefit in these circumstances.

If your mum is going to be renting from you and your sister, then you must tell the building society as there are different rules regarding buy-to-let mortgages. Do not be tempted to skirt round any regulations as this could lead to a lot of trouble later. Your solicitor should be shot for suggesting that you attempt to deceive any lender. Perhaps you should find another solicitor.

well, mum is old lady on income support so I assume she's entitled to housing benefit? We can't afford to pay a second mortgage so have to 'rent' it to her if we buy it.
I'm just astounded that an old lady of 73 with Parkinsons and Angina can't have enough 'points' to go into a warden sheltered bungalow. What on earth does one have to do to qualify!

She may well be entitled to housing benefit if renting from a private landlord to whom she is not related. However, local authorities to do look very closely at cases where benefit recipients are renting from parents/children. They would need to be satisfied that this was a genuine tenancy - in which case you may need to show that your lender is aware that it is a buy-to-let mortgage.

If she's 73, and has Parkinsons and Angina, would she not be better off in a care home rather than her own home. I'm not saying you should just dump her in ahome, but realistically, how long will she be able to live independently? And how much practical support will you and your sis realistically be able to give her, especialy with your own/kids diabilities. There is only so much you can do - and spending your energy visiting her and maybe taking her out would be better than doing the day to day crap and resenting it.

She doesn't qualify for residential. And she refuses to give up her dogs (she has 5)
Seeing a finacial advisor tomorrow to talk about mortgages. As it is, any HB she gets wont even cover the mortgage (they allow 90 per week for a single person. That would pay for a room in a shared student accomodation house. Hardly suitable for an old lady)
So me and my sister will have to pay the difference. Neither of us can truly afford it but we have no choice. We made an application for a council bungalow and she doesn't qualify. The man did say that even if she did, there aren't any available and it could be months/years (depending on howfast the current residents die off) and there are several hundred old people waiting for one.
Only place her 'points' would qualify her for is a studio flat - not even ground floor even though I explained she can't get up steps - with no garden so no dogs/pets.
If we don't get HB for her to help us cover this mortgage then we can't do this and she will be homeless. She's already threatening to kill herself - Parkinsons makes one a bit loopy and depressed and confused.
I'm getting very stressed about all this but can't see any choice or way out. There just aren't council places since the 'right to buy' thing and places to live are stupidly expensive.
Just don't know what to do

Can i just state you can get housing benefit paid to family, i know someone whos father brought a house & the son & his gf rent it from his father they are on income support & housing benefit pays there rent, they will only pay the rent of what they think is acceptable for it's size & who lives there.

According to the Gov website the 'relative rule' only applies if the relatives lives in the house with you so the HB office can claim you are not responsible for the rent.
This wouldn't be the case.