Mortgage, or Loan?

jaysnet

Hi all, I have a general query:

Me, mum & dad have lived at the same address for many years, and, in fact, the Mortgage will be paid by this autumn.

What we want to to is transfer the deeds to me - in other words, me buy the house from my parents.

It wouldn't be for the list price, but a gift-sized 40,000 - 50,000 pounds, secured on the property. This would be for the purposes of a few things:

Pay off all existing debts
Cash in parent's account to do with what they please
Cash in my account for the same reason!

I know this is just a vague and quick description of my idea, but would anyone be able to point me in the right direction regarding advice on where to start?

Much appreciated,

Jason.

Senior_Paper_Monitor

In principal easy and no problem, in the real world there are a wide number of circumstances to consider.

Without knowing all parties' ages, health, financial positions including assets and liabilities, ambitions/plans etc it is impossible to comment but there are potential issues including IHT, deprivation, lifetime interests and protection of future rights.

Most solicitors (particularly those actively in conveyancing practice), some accountants, some mortgage brokers and some IFAs will be able to give you best advice but you need to ensure that whichever has experience and full background knowledge in this area - you may need input form a combination of the above to ensure that you achieve the desired result in all circumstances.

In terms of loan or mortgage for the acquisition - almost certainly a mortgage, but depends primarily on your income (and other financial issues)

VIGILANT22

jaysnet wrote: »

What we want to to is transfer the deeds to me - in other words, me buy the house from my parents.

It wouldn't be for the list price, but a gift-sized 40,000 - 50,000 pounds, secured on the property. This would be for the purposes of a few things:

Pay off all existing debts
Cash in parent's account to do with what they please
Cash in my account for the same reason!



http://www.ageconcern.org.uk/AgeConcern/Documents/FS40Deprivation_of_assets_in_the_means_test_for_care_home_provision.pdf

Conrad

Jason, a secured loan would be much more expensive and from memory I do not think a FIRST CHARGE secured would be allowed. Far better to take a mortgage, which is a type of loan anyway.

Your parents will have to sign a disclaimer waiving all rights to the property including thier rights to reside there should you be repossessed.

jaysnet

Thanks for the replies guys!

Dan_1976

Yes, as Conrad says a mortgage would be the best route. However as already stated you should get a bit of advice regarding the whole thing.