buying out siblings on inherited house

whizzkid_3

hi,
my girlfriends mum sadly passed away recently and the house is to be shared between my partner and her brother and sister .

there was no will written . the plan is for us to sell our current house (approx value £75k) and put 50k towards the buying out of the inherited house (approx value £150k) along with my partners 50k share .we would keep the remainder of our sale proceeds and take out a £50k mortgage for the remaining £50k .

With the house we will be moving into what do we need to do ? just get some free valuations and agree a sale price with the brother and sister then try to sell ours ?i'm thinking there must be more costs involved that i'm not aware of ?

this is in Scotland by the way

thanks

whizzkid_3

will the solicitor handling the estate value the house anyway or will we need to get a valuation done independently ?

Emmzi

are the siblings happy for this to be done or do theyy want to buy the house?

I would suggest getting 3 valuations from surveyors - NOT estate agents! It will cost maybe £150 a pop but it is well worth it to avoid family arguements down the line. Then take an average.

But before you do this it is important you discuss with the siblings to see if they think this is fair BEFORE you pay out!

googler

The deceased died intestate, so ;

1: Someone needs to apply to the local court (usually a next-of-kin) to be appointed executor-dative. This has to be in a set legal form, so you'll probably need a solicitor to do it for you.

2. Once an executor-dative is appointed, he/she should obtain 'confirmation' of the estate. Since there's a property involved, it's unlikely to be classed as a 'small estate', and in order to obtain confirmation of the estate, the exec will require a 'bond of caution' to be provided to the local court along with the confirmation forms.

There's only two insurance providers who supply these - Sun Alliance and Zurich. Sun Alliance will only issue one to a solicitor handling the executry, and won't issue one to an individual executor. Zurich will issue one to an individual (I got one), but they're keen to emphasise that they don't normally do this.....

3. Only once confirmation has been obtained can the executor-dative distribute the estate. However, the executor has to realise the assets (i.e. including the house) before they can distribute the estate, which contradicts your plan of merely buying it before it's been distributed to those who are the real beneficiaries.

It would help to know if any of the above has been done already.

However, I'd recommend some legal advice from a solicitor who is well-versed in handling executries, to see if what you want to do is legally possible. You're looking to buy a share from a beneficiary of the estate, but they don't have any title to it, so can't legally sell it to you.

taxsaver

googler wrote: »

The deceased died intestate, so ;

1: Someone needs to apply to the local court (usually a next-of-kin) to be appointed executor-dative. This has to be in a set legal form, so you'll probably need a solicitor to do it for you.

2. Once an executor-dative is appointed, he/she should obtain 'confirmation' of the estate. Since there's a property involved, it's unlikely to be classed as a 'small estate', and in order to obtain confirmation of the estate, the exec will require a 'bond of caution' to be provided to the local court along with the confirmation forms.

There's only two insurance providers who supply these - Sun Alliance and Zurich. Sun Alliance will only issue one to a solicitor handling the executry, and won't issue one to an individual executor. Zurich will issue one to an individual (I got one), but they're keen to emphasise that they don't normally do this.....

3. Only once confirmation has been obtained can the executor-dative distribute the estate. However, the executor has to realise the assets (i.e. including the house) before they can distribute the estate, which contradicts your plan of merely buying it before it's been distributed to those who are the real beneficiaries.

It would help to know if any of the above has been done already.

However, I'd recommend some legal advice from a solicitor who is well-versed in handling executries, to see if what you want to do is legally possible. You're looking to buy a share from a beneficiary of the estate, but they don't have any title to it, so can't legally sell it to you.

I'm so glad that I'm covered by the laws of England and Wales!

WhiteHorse

Use reputable local estate agents rather than surveyors to supply written valuations.

Nowadays surveyors do give valuations, but in my experience they are often wide of the mark. They are supposed to base their valuation on the sales of three very similar properties in the vicinity. Unfortunately, they aren't estate agents so often lack the necessary local knowledge.

Emmzi

whereas estate agents are untrained and give you a higher price to try and get you to sell through them so in this instance the OP may pay over the odds. They won't value unless they think they are selling the property and therefore in for commission, they are not a charity! So ethics of misleading them, too...

Whoever they get to value the property it is key all siblings agree it is a fair method.

googler

WhiteHorse wrote: »

Use reputable local estate agents rather than surveyors to supply written valuations.

Nowadays surveyors do give valuations, but in my experience they are often wide of the mark. They are supposed to base their valuation on the sales of three very similar properties in the vicinity. Unfortunately, they aren't estate agents so often lack the necessary local knowledge.

You don't think a local surveyor has the same local knowledge as a local EA?

If the OP's relative applies for confirmation of the estate based on 3 EA valuations, and the court or the HMRC queries it (for IHT purposes), what then?

I got an RICS member to provide the valuation for a relative's house when I was doing the confirmation, because I knew that if anyone asked, all I'd have to say was "The Surveyor said it was worth £X. Take it up with him"

poppysarah

WhiteHorse wrote: »

Use reputable local estate agents rather than surveyors to supply written valuations.

How do you find which ones are reputable?


I've followed the local market for several years and have an idea of which I wouldn't trust to help an old lady across the road.... but for someone just dealing with them for the first time they all come across as reasonably competant and honest.

gordonbennet

Some estate agents (in england & wales) provide valuations for probate purposes. They will often give a low value 'officially' for the probate, but a more optimistic unofficial one for actual sales purposes.

googler

gordonbennet wrote: »

Some estate agents (in england & wales) provide valuations for probate purposes. They will often give a low value 'officially' for the probate, but a more optimistic unofficial one for actual sales purposes.

So you're condoning tax fraud?