Your property questions answered

Can siblings who sell get FTB exemption?

Q Given that couples who separate can regain a first-time buyer exemption, can a person who purchased a house with a sibling but who no longer has any interest in the property (ie, has given/sold their interest to the sibling) also regain their first-time buyer exemption?

AYou are right in thinking that married couples who separate can, under certain conditions, regain their first-time buyer status. There is a specific provision in the stamp duty code (section 92B(8) of the Stamp Duties Consolidation Act 1999) which may grant one of them FTB status if they buy another house. It appears to be a fair provision in that a separated person often has to buy a second home. However, this provision only applies in the case of a married couple and does not extend to siblings.

A person who purchased a house with a sibling (whether or not he/she has retained an interest in the house), is not entitled to claim the first-time buyer exemption on any subsequent purchase by him/her of another house. It’s something that siblings writing to this column in the past have discovered to their cost – particularly those people who helped their siblings get on the property ladder by helping with the deposit and co-signing the mortgage without ever having anything else to do with the property, not thinking it might have such an expensive impact on them later.

We’re splitting – but can’t sell apartment

Q We are splitting up and have to sell our apartment. It has been on the market for eight months with no interest. The estate agent says we must drop our price if we are to have any chance of selling but if we drop to the price he suggests we won’t cover the mortgage (shortfall of €20,000). Do lenders really come after people for this small amount? This has to be happening to other people so what do they do in this stalemate?

A The first thing is that while the agent has suggested a new asking price, that doesn’t in any way guarantee a sale or that you will even get that amount – so your shortfall could be greater than €20,000. At a new lower valuation, might one of you be able to buy the other out? Could you rent it out? What’s been happening in the eight months that your place has been for sale? Are you both still living there? Could one of you stay and get a tenant in to part-pay the mortgage? Or might it be time for you to cut your ties with this property and your ex and be prepared to sell at a lower price and take out a loan (or eat into your savings) and pay off the outstanding mortgage amount. And yes, if you don’t pay back a mortgage in full you can expect the lender to come looking for the outstanding balance no matter how relatively small it is. Not paying it will, at the least, ruin your credit rating for seven years, which could stop you moving on with your life in all sorts of ways.

Your questions

Send your queries to Property questions to:

The Irish Times, The Irish Times Building, 24-28 Tara Street, Dublin 2 or email propertyquestions@irishtimes.com. Unfortunately it is not possible to respond to all questions. The above is a representative sample of queries received. This column is a readers’ service and is not intended to replace professional advice. No individual correspondence will be entered into.