My mother has offered to pay off my mortgage so that I can save money on interest payments. Instead, I will make a regular monthly payment to her. How do we go about getting an agreement drawn up that makes the arrangement legally binding and keeps the house in my name?
You need to consult a solicitor who can draw up a formal loan agreement showing the date on which this loan is made, the amount that is being loaned, and the terms of repayment, including the date on which it is to be repaid and any interest payable in respect of late payment or otherwise.
You and your mother each need to get independent legal advice and you both must sign this agreement. A copy of this should then be registered against your property at the Land Registry and a Notice and/or a Restriction registered on the title deeds to your property, which shows that your mother has an interest in the property and that she must be notified before you sell or otherwise dispose of your interest in the property. This would be registered in the same way as a mortgage.
The property would remain owned in your sole name, but your mother’s interest (akin to an interest-free mortgage) would be clear from anyone examining the title deeds and would ensure your mother’s interest in having the loan repaid is protected.You should get advice from a commercial solicitor to draw up the loan agreement and get advice from a conveyancing solicitor to register this loan at the Land Registry.
Sarah Hughes is a family solicitor at Anthony Gold Solicitors.