Main site > MoneySavingExpert.com Forums > Who & Where are You? > Over 50s Money Saving > How can I sign a house over to my son? (Page 1)

IMPORTANT! This is MoneySavingExpert's open forum - anyone can post

Please exercise caution & report any spam, illegal, offensive, racist, libellous post to forumteam@moneysavingexpert.com

  • Be nice to all MoneySavers
  • All the best tips go in the MoneySavingExpert weekly email

    Plus all the new guides, deals & loopholes

  • No spam/referral links
or Login with Facebook
How can I sign a house over to my son?
Closed Thread
Views: 91,741
Thread Tools Search this Thread Display Modes
# 1
TheWaltons
Old 12-04-2007, 5:35 PM
Serious MoneySaving Fan
 
Join Date: Apr 2007
Posts: 1,183
Default How can I sign a house over to my son?

How can an OAP sign a house over to her son, without it costing hundreds?

She lives in her own property and has paid the mortgage off. She has also paid the mortgage off on her OTHER property, which her son lives in.

So, she has 2 properties. One she lives in. One her son lives in. Both in her name.

His name is on the Deeds of the house he lives in, along with her and his dad (parents).

She wants to give the house to her son, now before anything happens to her.

What can be done?
TheWaltons is offline
Report Post
# 2
consultant31
Old 12-04-2007, 8:43 PM
Fantastically Fervent MoneySaving Super Fan
 
Join Date: May 2006
Posts: 4,614
Default

I think you need to see a conveyancer (which is usually cheaper than seeing a solicitor). When my parents made their house over to me earlier this year, the cost was about £250 + £80 land registry fee, which I paid as I'm to be the one to benefit.
Experience is a wonderful thing.
It enables you to recognize a mistake when you make it again.

consultant31 is offline
Report Post
The Following User Says Thank You to consultant31 For This Useful Post: Show me >>
# 3
Willman Rodders
Old 06-05-2007, 11:45 PM
MoneySaving Stalwart
 
Join Date: May 2007
Location: North Staffordshire, England
Posts: 210
Default Why transfer the ownership of the house?

I know your original question was about how to transfer the title of a house to a son. Can I ask why the mother wants to transfer it?

As a willwriter and former IFA I often come across requests of this nature. There are usually one of two reasons:

1. Reduce the size of the parent's estate for IHT purposes; or
2. Avoid the house being forcibly sold to fund long-term-care.

In the case of 1 the inheritance tax 'gifts with reservation' rules apply, (unless the parent is paying a commencial rent on the property) which would negate the effect of the transfer for IHT purposes.

In the case of 2 the 'Care in the Community Act' allows Social Services to question why the transfer was made; the only logical answer as to why a parent would give up her residence is to avoid long term care costs. It is illegal to dispose of assets to avoid these costs. Social Services would then consider enforcing the son to fund the parent's long term care - again negating the effect of the transfer.

One final point. If the son does own the house what happens if he gets into financial difficulty and is declared bankrupt? What happens if the son (and assuming he is married) gets divorced? what happens if the son dies?

What a costly mistake it could be to transfer ownership.
Willman Rodders is offline
Report Post
The Following 11 Users Say Thank You to Willman Rodders For This Useful Post: Show me >>
# 4
greyteam1959
Old 07-05-2007, 9:27 AM
Fantastically Fervent MoneySaving Super Fan
 
Join Date: Jan 2007
Posts: 2,231
Default

Completely and utterly agree with Willman Rodders.
Its just not as simple and clear cut as people think this transfering property to sons and daughters......as he says lots of problems can arise.
greyteam1959 is offline
Report Post
The Following User Says Thank You to greyteam1959 For This Useful Post: Show me >>
# 5
margaretclare
Old 07-05-2007, 1:51 PM
Fantastically Fervent MoneySaving Super Fan
 
Join Date: Aug 2004
Location: Essex, England
Posts: 9,371
Default

I'm not so sure that all this applies - transfer of assets to avoid care costs etc. As I understand it, the OP owns 2 houses and only wants to transfer one of them to her son, which he's living in at the moment. (Is he paying rent to his mum for the house that she owns but that he inhabits?)

I think if that was me, I'd want to give the son his own house as a gift. It's not like transferring the title to her own house to avoid care costs, which is the usual scenario we hear about (with monotonous regularity).

The Mum in question is described as an OAP, which is a horrible demeaning term. She's a retired lady, one assumes - widowed or single, perhaps? There are better and more accurate terms than that horrible outdated 'OAP'.

Margaret
r ic wisdom funde, r wear ic eald.
Before I found wisdom, I became old.
margaretclare is offline
Report Post
The Following User Says Thank You to margaretclare For This Useful Post: Show me >>
# 6
Errata
Old 07-05-2007, 1:53 PM
Deliciously Dedicated Diehard MoneySaving Devotee
 
Join Date: Feb 2007
Posts: 32,518
Default

A slight clarification. It is not 'illegal' to dispose of assets such as property in order to avoid possible future care costs. The council will simply refuse to make any contribution to the costs if they believe someone has deprived themselves of assets deliberately in order to avoid contributing to some or all of their care costs, although the time gap between selling and needing care is taken into account.
In reality very few people need residential or nursing care and despite far more people living longer these days, government is keen for people to receive care in their own homes and the cost of this can be wholly or partly covered by attendance allowance.
Errata is online now
Report Post
# 7
EdInvestor
Old 07-05-2007, 8:57 PM
Deliciously Dedicated Doubly Diehard MoneySaving Devotee
 
Join Date: Sep 2004
Posts: 15,682
Default

Quote:
Originally Posted by TheWaltons View Post
So, she has 2 properties. One she lives in. One her son lives in. Both in her name.

She also needs to check the capital gains tax position which would arise if she makes a disposal of the property, as it's not her main residence.
EdInvestor is offline
Report Post
The Following 2 Users Say Thank You to EdInvestor For This Useful Post: Show me >>
# 8
Lady_K
Old 07-05-2007, 10:08 PM
Fantastically Fervent MoneySaving Super Fan
 
Join Date: Nov 2003
Posts: 4,388
Default

[QUOTE/]

One final point. If the son does own the house what happens if he gets into financial difficulty and is declared bankrupt? What happens if the son (and assuming he is married) gets divorced? what happens if the son dies?

What a costly mistake it could be to transfer ownership.[/QUOTE]

He would have to cover himself in case any of that happened including having a will himself to leave it to his own children if he has any would be the best thing I'd think

I've been thinking about doing this for some time now somehow myself
Thanx

Lady_K
Lady_K is offline
Report Post
# 9
chateau
Old 08-05-2007, 7:08 PM
MoneySaving Convert
 
Join Date: Jan 2007
Posts: 16
Default

I was told that there is a timespan of seven years, beyond which sons or daughters would be safe from having to pay care costs once they have acquired the property. Has anybody heard this?
chateau is offline
Report Post
# 10
margaretclare
Old 08-05-2007, 7:43 PM
Fantastically Fervent MoneySaving Super Fan
 
Join Date: Aug 2004
Location: Essex, England
Posts: 9,371
Default

Quote:
I was told that there is a timespan of seven years, beyond which sons or daughters would be safe from having to pay care costs once they have acquired the property. Has anybody heard this?
I've heard just the opposite - that there is NO time-span.

I think this case is a little bit different in that son actually lives in the house she's proposing to give him, and I can't see why anyone would object to that. The lady still has the other house, the one in which she lives, no one is proposing that she gives that one away as well.

On the wider question, 'safe from having to pay care costs'. Just who is supposed to pay these care costs, if the person herself doesn't?

BTW we haven't been told how old the lady is. Are 'care costs' a likely scenario?

Margaret
r ic wisdom funde, r wear ic eald.
Before I found wisdom, I became old.
margaretclare is offline
Report Post
The Following User Says Thank You to margaretclare For This Useful Post: Show me >>
# 11
Willman Rodders
Old 08-05-2007, 9:57 PM
MoneySaving Stalwart
 
Join Date: May 2007
Location: North Staffordshire, England
Posts: 210
Default Clarification of a number of points ...

Firstly thanks to 'errata' for correcting my earlier statement.

With regards to Chateau and the 7-year rule - in my experience this is a common area of confusion. However ....

The 7-year rule applies to inheritance tax planning (make a gift, and survive 7 years - the gift falls outside of the estate for IHT calculation.); and

The funding of long term care costs is governed by Care in the Community 1990 and I understand there is no time limit.

As a will writer some years ago I was concerned about the validity of using trusts in a will to protect property from funding long term care. The head of legal services for a council advised me that they will look at the background to each and every case. He stated there was no time limit; importantly if you are showing signs of dementia and then you make a will, or transfer assets away from your estate this is a 'clear sign of trying to avoid paying your fees'.

Margartclare has mentioned in a couple of posts that long term care may not be a concern, and that the lady wants to give her second house to her son. I read, and have reread the original post and I missed Margaretclare's angle.
However, I remain confused. The original post talks about two properties, both in mother's name and then states...

His name is on the Deeds of the house he lives in, along with her and his dad (parents).

so I am still not sure which property mother is looking to transfer to her son.
Willman Rodders is offline
Report Post
# 12
Errata
Old 08-05-2007, 10:43 PM
Deliciously Dedicated Diehard MoneySaving Devotee
 
Join Date: Feb 2007
Posts: 32,518
Default

Local authorites may have flexibility on what kind of gap is acceptable between disposal of assets and requiring the LA to contribute to care costs.
For instance 20 years may be ok, 20 months not. Of course the difficulty is that nobody can know whether they will need care eventually and when it will happen.
Errata is online now
Report Post
# 13
stu54
Old 17-11-2010, 9:05 PM
MoneySaving Newbie
 
Join Date: Nov 2010
Posts: 1
Default

Quote:
Originally Posted by Errata View Post
A slight clarification. It is not 'illegal' to dispose of assets such as property in order to avoid possible future care costs. The council will simply refuse to make any contribution to the costs if they believe someone has deprived themselves of assets deliberately in order to avoid contributing to some or all of their care costs, although the time gap between selling and needing care is taken into account.
In reality very few people need residential or nursing care and despite far more people living longer these days, government is keen for people to receive care in their own homes and the cost of this can be wholly or partly covered by attendance allowance.
Just joined & not sure what to do

Question What if parents remortgage thier property & lost this money plus their savings whilst gambling or playing on line bingo. Would this be a way, Im sure this wouldnt be trackable. Then care would be payed for. Any views please.
stu54 is offline
Report Post
# 14
dzug1
Old 17-11-2010, 10:15 PM
Deliciously Dedicated Diehard MoneySaving Devotee
 
Join Date: May 2008
Posts: 12,678
Default

Quote:
Originally Posted by stu54 View Post
Just joined & not sure what to do

Question What if parents remortgage thier property & lost this money plus their savings whilst gambling or playing on line bingo. Would this be a way, Im sure this wouldnt be trackable. Then care would be payed for. Any views please.
The remortgage IS trackable.

And isn't spending on gambling deliberate deprivation of assets?
dzug1 is offline
Report Post
# 15
Mojisola
Old 17-11-2010, 10:22 PM
Deliciously Dedicated Diehard MoneySaving Devotee
 
Join Date: Jul 2007
Posts: 18,535
Default

Quote:
Originally Posted by stu54 View Post
Just joined & not sure what to do

Question What if parents remortgage thier property & lost this money plus their savings whilst gambling or playing on line bingo. Would this be a way, Im sure this wouldnt be trackable. Then care would be payed for. Any views please.
"Would this be a way" to make the taxpayer fund their care while their children try to hide the fact that they're living beyond their income, spending money from a huge stash of cash hidden somewhere? I can see a lot of potential problems.

Visit a few homes which are financed by the council and then a few where people are paying for their own care. See which you would rather spend your last years living in.
Mojisola is offline
Report Post
# 16
oldandhappy
Old 17-11-2010, 11:19 PM
MoneySaving Stalwart
 
Join Date: Apr 2006
Location: Bexhill on Sea
Posts: 602
Default

Our neighbour last year lost her Husband suddenly and as she suffers from dementia she was unable to look after herself so her only Son decided a nursing home was the best option for all. The property had to be sold to pay for the ongoing healthcare. He said to us it would not be what either of his parents would have wanted to have happened. No choice of passing on there lifetime wealth to children in this situation which I find a real shame actually. Dianne
oldandhappy is offline
Report Post
# 17
Mojisola
Old 18-11-2010, 11:16 AM
Deliciously Dedicated Diehard MoneySaving Devotee
 
Join Date: Jul 2007
Posts: 18,535
Default

Quote:
Originally Posted by oldandhappy View Post
Our neighbour last year lost her Husband suddenly and as she suffers from dementia she was unable to look after herself so her only Son decided a nursing home was the best option for all. The property had to be sold to pay for the ongoing healthcare. He said to us it would not be what either of his parents would have wanted to have happened. No choice of passing on there lifetime wealth to children in this situation which I find a real shame actually. Dianne
Why should the taxpayer pay for her care just so her son could inherit a lot of money?
Mojisola is offline
Report Post
The Following 12 Users Say Thank You to Mojisola For This Useful Post: Show me >>
# 18
getmore4less
Old 18-11-2010, 2:00 PM
Deliciously Dedicated Diehard MoneySaving Devotee
 
Join Date: May 2007
Posts: 18,656
Default

Quote:
Originally Posted by TheWaltons View Post
How can an OAP sign a house over to her son, without it costing hundreds?

She lives in her own property and has paid the mortgage off. She has also paid the mortgage off on her OTHER property, which her son lives in.

So, she has 2 properties. One she lives in. One her son lives in. Both in her name.

His name is on the Deeds of the house he lives in, along with her and his dad (parents).

She wants to give the house to her son, now before anything happens to her.

What can be done?
Fairly simple title transfer and a check on the tax situation.


On the assumtion that they own a 1/3 each then that would be the values used for the calculation of any CGT for the Mum and Dad.

There are various reliefs that may apply for example if the parents lived there befere the current place.

Since this is the sons home(how long) and allready owns part of it the deprivation of assets is unlikely to apply as long as they are all in good health.

As others have said the situation needs carefull consideration for the possible followon senarios.
getmore4less is online now
Report Post
The Following User Says Thank You to getmore4less For This Useful Post: Show me >>
# 19
jimjog
Old 27-01-2011, 11:44 AM
MoneySaving Newbie
 
Join Date: Jan 2011
Posts: 1
Default

My mum and dad bought their council house over 3 years ago and would like to transfer ownership over to me, they will continue to live in the house until they both pass on. However, what we are worried about is my mum and dad losing their benefits they are both on disability living allowance and they also get council tax benefit. If the house is signed over to me will that mean that I will have to then pay fulll council tax and that they will lose their DLA? They are both in their 70's and are just wanting to do right by me but I don't want them to lose out in any way and I just want them to enjoy the erst of their days in the home that they have loved for over 30 years. Can anyone advise me on this and any other in's and out's of this that I probably don't know about? Many thanks
jimjog is offline
Report Post
# 20
monkeyspanner
Old 27-01-2011, 12:23 PM
Fantastically Fervent MoneySaving Super Fan
 
Join Date: Oct 2005
Posts: 2,034
Default

Difficult to advise on this without you giving a little more as to why they want to do this. Is it IHT related (if your parents continue to live in the house without paying rent it will be considered a gift with reservation) or care home fees related (you need to consider deliberate deprivation of assets). What about if you go bankrupt or accidentally die what happens to the house then?

As regards the DLA I think it would be better to start a new thread on the benefits forum
monkeyspanner is offline
Report Post
The Following User Says Thank You to monkeyspanner For This Useful Post: Show me >>
Closed Thread

Bookmarks
 
 




Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

 Forum Jump  

Contact Us - MoneySavingExpert.com - Archive - Privacy Statement - Top

Powered by vBulletin® Copyright ©2000 - 2014, Jelsoft Enterprises Ltd.

All times are GMT +1. The time now is 4:29 PM.

 Forum Jump  

Free MoneySaving Email

Top deals: Week of 10 September 2014

Get all this & more in MoneySavingExpert's weekly email full of guides, vouchers and Deals

GET THIS FREE WEEKLY EMAIL Full of deals, guides & it's spam free

Latest News & Blogs

Martin's Twitter Feed

profile

Cheap Travel Money

Find the best online rate for holiday cash with MSE's TravelMoneyMax.

Find the best online rate for your holiday cash with MoneySavingExpert's TravelMoneyMax.

TuneChecker Top Albums

  • THE SCRIPTNO SOUND WITHOUT SILENCE
  • TRAINBULLETPROOF PICASSO
  • SAM SMITHIN THE LONELY HOUR (DELUXE EDITION)

MSE's Twitter Feed

profile
Always remember anyone can post on the MSE forums, so it can be very different from our opinion.
We use Skimlinks and other affiliated links in some of our boards, for some of our users.