Son buying House for Mum - drawbacks?

ElaineC_2

I moved out of my family home 5 months ago, into rented accommodation, taking my grown up children with me. This was done because it was easier to go rather than force my OH to leave.
I do not earn very much, but have equity in the FMH, there will be enough to buy a smaller house for each of us. OH does not want to co-operate and so I am stuck in a rented house when I want to get a home of my own.

My question is: I do not earn enough for a mortgage, but one of my grown up sons does. He is 19 with no dependents and a good job. What would be the drawbacks of him buying a house in his name, with the intention of transferring ownership to me when the FMH is sold?

I realise that he would be eligible to pay no stamp duty for this house, but not on the one he would buy in the future, but this can be taken into account when the equity comes through.

Can someone talk me through the pitfalls? We have a very good relationship and there is no question about either of us reneging on the agreement, or cheating the other out of anything.

Thank you for your time reading this.

pleasedelete

Ok. He would buy the house in his name but you would live in it?

Is that what you mean? Rather than he would buy a house for you (in your name). What happens if you can't sell your home? What happens if the value falls before then?


But mostly What happens if your home doesn't sell for enough to buy him out. He will still have a house and a debt.

I think that 19 is too young to make these decisions. I know that he has offered but I think it's too much to expect and you should turn him down. You are maybe putting an unfair potentially 25 year long burden on him.

He is being kind but in today's market and at only 19 I cannot see how this can be in his best interest only yours.

ElaineC_2

I realise that this seems a very selfish thing to ask of my son, but the home he buys will be a home for his family to recover from recent bad experiences which are difficult to go into at the moment. Needless to say there was a reason why we all felt we had to move out and not ask OH to leave.

There are enough of us to ensure the mortgage is covered each month, I would not expect my son to actually be out of pocket by doing this. I would take out the mortgage myself if I was able to.

We are in rented at the moment, so what other options are available - can I force the sale of the FMH?

I would be interested to find out how we would be able to transfer the house into my name once my equity comes through - I assume it is just like selling it to someone else?

Once again there is no pressure on my son, and there is no way I would ever see him out of pocket by helping his family out in this way. Please do not think I would ever put any pressure on him, we have a very good relationship, and have been through hell together - nothing will spoil our relationship, I will not let it as I have fought too hard for my children to be happy and safe.

I do have a considerable deposit to put down on the house, so even if we had to sell it in the future he would get all of his mortgage money back easily. He would be putting in approximately 40% of the value of the house.
Thank you for reading

hazyjo

I'd keep renting. Don't know why you're so keen to own something that you would 'encourage' your son to buy something for you all. He might well want to move out in a year or three. I don't see how this is of any benefit to him.

If he buys it, then you buy it off him, you will incur two lots of costs for the same house.

Just wait, I'd say. Don't get the desperate rush to own something right this second.

Jx

InkZ

Just wait. It saves any complications and if your FMH sells for less than you think it will (which it probably will) and you don't have enough to transfer the new house just as one example scenario, you will avoid all of this in the future.

If he's only 19, he might not have built up a good enough credit score yet to actually get a mortgage in the first place anyway.

ElaineC_2

Thank you for your replies, I had not thought that his credit score might not be good enough to get a mortgage. He has never had any credit in his life, only a contract phone on a monthly contract.


I think the reason I am in a hurry to move is that the rent here is a lot more than a mortgage would be, so financially it would make sense to move as soon as possible.


Is there any advice from anyone on forcing a sale of the FMH or do I just have to wait for OH to co-operate eventually?

Thank you

pmlindyloo

I have read this a few times and I am still not certain of your position - sorry.

Have I got this right?

Your former home is in joint names, your OH is living there, but it is up for sale. When it is sold you would have enough cash to buy a small place. Or

As above, but when the former house is sold you would have a deposit for a new house but could not get a mortgage - hence your queston about your son getting a mortgage?

I think most people are thinking that you will eventually have enough cash to buy a house outright so you might as well wait rather than involve your son.

Which scenario is correct? Or am I completely muddled? (Smiley face should go here!)

pmlindyloo

OK - crossed posts (although clarifiaction of your position to answer original question would be helpful)

It seems that the house is not up for sale at the moment and your OH is not being cooperative.

I think there are situations where you can force a sale but my understanding is that you may need a solicitor for this. Of course we do not know all the background to the separation but mediation (sorry if this is entirely inapproprate) is also a possibility, where a 3rd party could help you come to an agreement as regards the house sale.

BitterAndTwisted

If the family home is jointly-owned you can force a sale. Of course, the simplest thing to do would be to both agree that it needs to be sold so that you can provide a decent permanent home for yourself and the kids. See a decent solicitor about how to go about forcing a sale.

G_M

I too am confused. In addition to pmlindyloo above:
Who will live in this newly bought home? You say

there will be enough to buy a smaller house for each of us.

but also:

the home he buys will be a home for his family

so
1) is he going to buy two homes - one for himself and one for you which you will later buy/receive from him when your current home is sold....?

Things to consider
1) are you getting a divorce? the divorce setlement should deal with your current property which your ex may be forced to sell
2) if your son buys a house for you to live in (either permenant or till the current property is sold, AND he does not live there too, then you will be a TENANT and he will be your landlord. Lots of issues: landlord obligations; tax on rent; Capital Gains Tax when the property is sold/transferred to you; benefits issue if relevant.....
3) if the plan is for son to buy ONE property and you both live there together, you are a lodger so fewer issues.

ElaineC_2

Sorry to confuse you. The FMH is not up for sale, as OH is not co-operating, so it may take a while to sort out. I have enough money to finance 60% of a property for the family to live in, but cannot get a mortgage for the rest of it as I do not earn enough.

The rent on this place is higher than the mortgage would be, and I do not want to stay in rented for longer than I have to. I would like a family home so my adult children and I can have a secure home which we do not have to worry about having to move out of.

I can see as I write this that it is unfair on my adult son to ask him this, as there is no way I can fortell how long it will be until the OH co-operates or the house sells once it actually goes on the market.

Thanks for all your help everyone. Sometimes just writing it all down helps to see it from another point of view.
xx