Can I get a mortgage on a property I already own

C

carbunny

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We have sale agreed on a house but its looking like our mortgage wont have come through on time to close the sale. We are lucky through savings and a loan from family to be able to purchase the property with cash. (family will have no charge on the property) It will be bought in mine and my husbands name only) My question is can we then get a mortgage to pay back family and renovate the property. It needs a lot of work
We would like to get a mortgage for the total amount minus deposit. ie. House price 200k Mortgage 160k
We are putting in 130k and a loan of 70k from family. The savings were originally to do up the property
 
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"its looking like our mortgage wont have come through on time to close the sale."

You're getting a mortgage. You just won't have it before you close the deal. But if you already have mortgage approval for the property, you draw down the mortgage after you close the purchase.

mf
 
That seems a strange thing. Why would the bank bother giving the mortgage then? They have no collateral if the person does not pay back the mortgage, since the person owns the house, not the bank....wouldnt that imply the mortgage would basically then be a huge unsecured personal loan, at a rock bottom rate?

Looking at this from bank's perspective I don't know why they would entertain this scenario personally.

Perhaps I'm missing something?
 
Would it still be so if the OP has bought the house outright with cash? The mortgage protection policy would normally tie the bank as having an "interest" (i.e. claim) on the house. Would this still be in place here?

As I said, IMO its a rather odd scenario, so I'm only surmising.
 
Its not unusual.

So, OP buys house with cash. Thereafter, the mortgage funds will go through the solicitor who will undertake to register the mortgage and return all the Deeds to the bank. It will be a condition of the loan that there is a mortgage protection policy in place.

mf
 
Thanks
Yes the house would be the security for the bank. Its really just a timing issue. The vendor will put the house back on the market if the sale is not closed ontime. The property has gone up in value since sale was agreed.
 
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