Questions over mortgage, selling property

Discussion in 'General Chat' started by Coffin, Jan 5, 2012.

  1. Coffin

    Coffin
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    Hello :)

    Some advice on the following would be most appreciated..

    A husband and wife own a property. The deeds to the property are held personally by the couple. The full names of both the husband and wife are stated on the deeds

    The property has a mortgage, say £150k. The value of the property is £250k

    The mortgage is held in both of their names, i.e. a joint mortgage

    The couple wish to sell the property. One spouse is based abroad for a lengthy period of time and is unable to physically participate in the sale of the property

    1) Is it possible to sell a property with one of the spouses unable to 'interact' physically?

    I am assuming to have the house valued and listed for sale will not require both spouses - ?

    2) At what point during the entire sale process, right through from start to completion will both spouses be required to do something?

    I am assuming the completion is the key part? The spouse will be contactable and able to forward information if required

    On a slightly different subject..

    If I have a mortgage of £90k and I win £100k on the lottery, I can of course choose to clear my mortgage in full

    3) Is there any 'benefit' to retaining part of the mortgage sum owed? For example I pay off £80k leaving £10k outstanding

    I have heard (possibly incorrectly) of the benefits of having a mortgage, which may sound odd, hence why I ask

    4) As previous I have a £90k mortgage. I contact my lender to pay back a significant sum of the outstanding loan, or even in full. I am not subject to any penalties in paying back prematurely

    Will the lender ask where the money has come from? When I applied for my first and only mortgage I had to clearly confirm where the deposit was coming from, i.e. document copies of my savings account stating the funds available

    I would imagine a lender would be pleased to have their money returned to them but, given how odd things sometimes work in such scenarios, would I be obliged to justify my source of funds?

    5) If a property is sold, with no further property purchase made and there is equity left after the sale and loan has been paid back, would I be correct in assuming the equity monies are paid into the account from which the mortgage payments were previously debited?

    I am sure to think of something else

    Many thanks
     
  2. MikeP1

    MikeP1
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    At a guess I would imagine the first step would be to have the abroad partner appoint a power of attorney. After that the partner would not be required for any of the steps.

    A phone call to a friendly solicitor should be able to give you the answer.

    Point 3 - I've heard this also. Some people think it helps with credit ratings. I'm not convinced, I would pay off the mortgage if you can. Just keep using a credit card & paying it off monthly.

    Point 4 - yes I believe you do need to have some form of paper trial because of laundering risks. I think anything over 10k requires that.

    For point 5, yes the equity left over would be returned to your bank account by the solicitor I believe.

    These are all just from my opinions/experiences, none are def facts.
     
  3. imightbewrong

    imightbewrong
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    1/ Yes

    2/ I doubt they need to attend anything in person.

    3/ Depending on the terms of your mortgage, if you over-pay but leave it open you may be able to 'borrow back' your overpayment more easily at a later date, than take out a new loan if you need one. However I would not leave £10K for this purpose, - more like £500:)

    4/ Most probably.

    5/ Most probably.
     
  4. StevePSIV

    StevePSIV
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    Do people here generally overpay the mortgage every month? I'm assuming you're better off doing that then putting money into savings?

    I've only owned my house for two years and in the time we've only paid the amount we're supposed to. The reason for that being that we're getting married so our spare money has been going into savings to pay for that!

    The plan is to then put more money into the mortgage once we're married. Ideally want to be mortgage free by the time I'm 35!

    Fixed term also runs out at the end of this year. Guessing I should start looking around now for the best mortgage deals..
     
  5. Coffin

    Coffin
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    Thanks for you replies

    Could you please elaborate, are you also referring to power of attorney?

    Are there any alternatives?

    The point I am emphasising is that both spouses agree to sell the property. The UK based spouse has the deeds in his or her possession

    I am assuming, for example, one spouse cannot handle the administrative process themselves with the other spouse writing a letter to the solicitor or sending a photocopy of their passport or making a call etc.

    My question is over the actual legal requirement and obligation by both spouses when it comes to selling a joint held property in regards to the sale process, completion etc
     
  6. imightbewrong

    imightbewrong
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    Generally speaking you should not put money into a savings account if you can over-pay it into the mortgage - particuarly if you are putting it in there for the long-term, although also generally speaking you can just 'get back' any overpayment, although there may be an income test, depending on the lender.

    This of course assumes that your savings interest minus tax is less than your mortgage interest. Anyone paying near zero rates due to long term trackers should do the opposite - borrow to the max and stick it in savings :)
     
  7. imightbewrong

    imightbewrong
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    IANAS but I would be amazed if you had to get on a plane at any point to sell your property, even if you were sole owner and living abroad. I bought a flat from someone that had emigrated and I'm sure they never came back during the process.

    Surely it can all be done with facetime now anyway :D
     
  8. Coffin

    Coffin
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    I see. Thank you

    Is there anyone here whom is part of a couple and have recently sold their property?

    What did you and your spouse have to do? Did you sell it without his or her physical input and without a power of attorney?
     
  9. russ123

    russ123
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    re point 3, it used to be convenient to have a small mortgage as the bank normally hold the deeds whilst there is any mortgage amount outstanding to safeguard you selling it and not paying them back. Once you own it outright then you get the deeds and then used to have to pay to store them securely. Having a notional balance left of a few quid meant they still stored them for you. Now it is electronic and there are no physical papers it does not matter.

    re point 4, no they won't care where it comes from unless you deposit cash to pay it off. You are more likely to transfer it from another account of yours and it would have been that banks responsibility to ensure it was legitimately received. Once it is in the banking system in your name there should be no issue moving it around.

    re point 5, the solicitor received the funds, pays off any deductions such as estate agent, mortgage, his own fees and will then ask you where you want the remainder paid into.
     
  10. imightbewrong

    imightbewrong
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    > re point 4, no they won't care where it comes from

    I wouldn't say this was guaranteed, although I'm sure it has come from a legitimate source of course :)
     
  11. Jenn

    Jenn
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    If I remember well, both my husband and I had to sign the paperwork when we exchanged contracts but it was all done at home as we used online solicitors.
    They'd send us the paperwork at home and we'd post it back signed.
     
  12. Coffin

    Coffin
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    The local mafiosi! :D

    Thank you all for your replies. Any further information from others reading or with any insight at all would be grateful
     
  13. imightbewrong

    imightbewrong
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    If you need >defnitive< answers, you should just ask your local friendly solicitor :)
     
  14. Grangey.

    Grangey.
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    on point #3 I always thought that its becuase mortgages are the lowest rate loan you can get technically, so it makes more sence to be able to borrow again from it than to completely clear it and have to go down the high street bank routes and secured loans and finance...?

    That assummes you wish to have that flexibility.

    Could be completely wrong on that though
     
  15. andyk

    andyk
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  16. imightbewrong

    imightbewrong
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    Indeed - when I sold my flat I never met the solictor once - just did a cheapy internet sale.
     
  17. KCooperman

    KCooperman
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    When my parents moved house a few years ago I had to sign some forms. In my case I went to the solicitors and signed them there as they were local but im sure in your case you would be able to do this electronically or via post as above
     
  18. Coffin

    Coffin
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    Thanks again for the replies

    In relation to my point of clearing a mortgage, to clarify; if I reduced my mortgage from say £90k to a nominal figure, say £1k and then later wanted to borrow money from the lender against the property, they would loan the monies at whatever the rate of interest was at the time, whilst payments were still being made? Thus my mortgage sum borrowed would increase accordingly

    And presumably I would be very likely to receive the said loan as the existing loan agreement would already be in place and I would hold considerable equity in the property?

    What if I cleared the mortgage in full and then at a later date wanted to obtain a loan, say £50k. Would I effectively be able to take a new 'mortgage' against the property at favourable rate instead of going down the bank etc method?

    Sorry if some of this is trivially obvious
     
  19. imightbewrong

    imightbewrong
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    You should just be able to borrow it back yes, but if your income situtation has substantially changed (for the worse) then they might say no.

    You should be able to get a new mortgage, yes, providing again you can finance it. Not sure what you mean by 'getting a mortgage at a favourable rate instead of going down the bank method' - you have to go to the bank, and the rate you will pay will be the market rate.
     

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