Buying house from parents

mat1982x

Hello

My parents have a mortgage with £86k outstanding. They are at retirement age and I (and siblings) want to take over the mortgage.

The mortgage is an interest only one and expires in August, they won't be in a position to renew it or pay off the £86k.

I am wondering what is the best solution, as the house is worth £200k to £220k, can we buy it from them for £86k? I'm guessing this isn't allowed.

Credit rating won't allow them to get a new mortgage, so we'd like to step in and help.

Many thanks

Mat

GMS

You could buy it for that price using a 'gifted deposit'

Issue you have is where parents would live. Most lenders would not allow them to sell the property at undervalue and remain living in it.

What were the intentions?

mat1982x

Hiya

Thanks for the quick reply. The intention is for them to continue living, also my sister who would be part of the new mortgage.

The gifted deposit, is this something that has tax implications?

Thanks

Mat

getmore4less

The problem with this senario is you will end up financialy linked with others which is not generaly a good idea if it can be avoided.


Do you have equity in your own places you could borrow against and pay off the parents mortgage buying part of the house.

Whatever you do there will be potential tax implications, CGT because you will own part of a house you don't live in, IHT if any gifts are made.