Will any lender calculate my actual outgoings?

Q I currently own 25% of my parents' house (my brother also has a share) and there is a joint mortgage between the four of us. I don't live there, and am keen to buy a place of my own with my wife and son.

Even though I don't live with my parents, and make no financial contribution to the mortgage, every lender I try will take that mortgage into account when assessing how much they can lend me, and treat it as though I am paying the full amount each month (£450). For me, this makes the difference between being able to buy or not. The building society where the existing mortgage is held refuses to release me from the agreement, arguing that the other three parties could not afford it, even though I am contributing nothing, and they are paying the mortgage themselves.

It's a £40,000 mortgage on a house worth £150,000, so I can't see that the building society would ever lose money on it. Can I be released from the mortgage? I am willing to give up my share of the equity for nothing. Otherwise, could I use the equity from the existing property to secure a mortgage for myself or find a lender who will look at my actual, rather than potential outgoings, without charging me a premium interest rate?

DA

A First the bad news: while you still have a joint mortgage with your brother and parents, it's unlikely that you will find a lender who won't take what you call your "potential" outgoings into account when assessing your mortgage application. The fact that you don't currently make any financial contribution to the mortgage doesn't cut any ice because as a joint mortgage holder you are liable for the whole debt so if your family failed to pay, you could be made to.

Increasing the joint mortgage to enable you and your wife to buy a property could be an option if your lender agrees. But for such a move to be worthwhile, you would need to be able to raise sufficient cash from increasing your current joint mortgage to buy your own property outright (given that you can't seem to get a mortgage of your own). Your lender would also need to be convinced that your other family members would be good for the increased amount if you were to fail to make repayments.

However, assuming that there are no penalties for early repayment of the joint mortgage, and assuming that your parents and brother have sufficient income to support a £40,000 mortgage in the eyes of another lender, switching the joint mortgage might be a way of releasing you from it. But doing this might mean that your name has to be removed from the title deeds, so it would be worth getting legal advice. And rather than approaching lenders directly, the unique nature of your current arrangement suggests that you would do well to enlist the help of an independent mortgage adviser such as London and Country or John Charcol.