Iv had an idea, just wondering if anyone has had any experiences with it or actually done it or even if it is possible – I am currently a student living in a council property with my mother – she has been a tennent for over 30+ years and therefore would qualify for the full discount available to purchase the property… The house is worth around 90k – We should hopefully be able to get a very good discount on the property – the Maximum available… To do this we would not be able to sell the house for at least 3 years…
I am not in a financial position to get a mortgage and neither is my mother – My idea is that if we could find an investor to get a mortgage, we buy the property in our names… draw up some kind of contract or agreement with the investor, then after 3 years, we sell the property, the investor gets back the money he has invested in the house – then what ever profit is made from house prices going up and the substantial discount we get, this is split between both party’s when the house is sold…
In theory this seams like a good idea, can this be done ? and has anyone got any experiences with this ?
To get the mortgage, the investor would have to be on title. ie own part of the property. This may not qualify you for the discount.
Another way around it would be to borrow the deposit from the investor and for your mum to buy it by herself.
Terryw
Discover Home Loans
[email protected]
Send an email to get my newsletter.Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Can’t offer any advice regarding an outside investor, but my inlaws recently did the same thing in the UK. They bought their council house 3.5 years ago with the view of returning to Australia to live.
My father-in-law is on a disability pension and my mother-in-law did shift work on a factory production line, so it was really only her money paying the mortgage. They achieved this by getting an interest only loan, which reduced the payments compared with a principle & interest loan. It was really tough on them for the 3 years financially (no unecessary lifestyle expenses), but they knew it was the only way to get a deposit for a home back here.
What I’m getting at is that if you can’t find an investor and want to try it yourselves somehow, it may be restrictive on your lifestyle but the end goal is what keeps you going. They stuck it out for exactly 3 years and spent that time doing the place up when they could spare any cash.
Even though there is no real advice here, perhaps hearing how they did it will inspire you.
I wish you the very best of luck and keep thinking outside the box like you are. The answer is out there, keep looking for it!
It would help if you would outline why neither you nor your mother can get a mortgage.
Normally you can get a mortgate even when on a pension or casual. A good mortgage broker can look at your situation and advise on the best possible approach.
Getting an investor may be possible. I think the idea of lending the deposit to your mum may be the way to go. Security now becomes the big issue. Is a 2nd mortgage possible? Or perhaps use a caveat?
I would strongly advise that you get some good legal advise before proceeding down this track.
Good Luck
You must be logged in to reply to this topic. If you don't have an account, you can register here.
