Buying parents house....

mark_steps

Ok here is the jist of the story.

The OH's uncle has some money and is prepared to give it to my parents on the condition that they put it into the will that we both get the house when they pass away. That would then legally make it ours so we are 50/50 on the property right?
It will be dealt with by solicitors, im just nervous about anything like this. I mean if we all sign a lifetime tennany agreement, my parents cant be kicked out can they?
Any thoughts on this? If me and the OH split up, we have the option to buy each other out right?? And none of us can sell if teh other one still has part ownership right??

Bossyboots

I am a bit confused by what you are saying.

However can I take that you are saying that your OH's uncle will give your parents the money provided they leave their house to you and your partner in their wills?

You then seem to be under the impression that bequeathing the property in the wills means you have a share of the property now. That is not the case. It does not come into the ownership of you and your partner until the second of your parents has died.

On that basis, your parents cannot be kicked out of the house by your or your partner because you have no legal interest in the property until then. You would also only get what is left after debts are paid so even if the house is left to you in their wills, if they run up debts before dying the house may have to be sold to pay those off.

As for when it passes to you and your OH, you have no automatic right to buy out the other if you split. Either of you could prevent a sale while the other has part ownership. However, a court can order a sale and make a costs award if one party is unreasonably witholding their permission to sell.
Once the property passes to you, you would need to get an agreement drawn up as to what happens if you split up.

Sorry if I have misunderstood anything but you may need to give a few more details to clarify things.

mark_steps

You have prerry much hit the nail on the head.

"You then seem to be under the impression that bequeathing the property in the wills means you have a share of the property now. That is not the case." Dunno what that means but i knew that when both parents pass away we get the house.

Any debts run up are paid of when they die. So if i can pay them off, good, if not the house may be sold to recover the debt, am i right? PS What sorts of debt??Cause they will drop sky etc and just keep essential things.

"As for when it passes to you and your OH, you have no automatic right to buy out the other if you split. Either of you could prevent a sale while the other has part ownership. However, a court can order a sale and make a costs award if one party is unreasonably witholding their permission to sell.
Once the property passes to you, you would need to get an agreement drawn up as to what happens if you split up."

Ok so my parenst would have it until both die. Then if no debt is left, we get the house. At that point, we have a legal agreement made up to say what happens if we split up. Can that then include buying the other one out? Or is the chance to buy each other out - right out the window ie No chance?

Thanks for this info BTW

Bossyboots

mark_steps wrote:

Ok so my parenst would have it until both die. Then if no debt is left, we get the house. At that point, we have a legal agreement made up to say what happens if we split up. Can that then include buying the other one out? Or is the chance to buy each other out - right out the window ie No chance?

Thanks for this info BTW

Your agreement can certainly include a clause in relation to buying each other out. You might need to consider whether one of you has priority over the other. What happens if you both want to buy the other out? You would then also need to consider who will pay what legal fees.

As for what debts your parents might run up, who knows. They may end up with credit card debts, loans or any of the other debts folks on these forums mention. Don't think they won't do that. You don't know what hard times they might fall on or what luxuries they might want to treat themselves to later in their lives. They may want more than the "essentials" of life as they grow older. That is their privilege if they can afford it but it could mean they have outstanding financial matters when they die.

It would be a good idea to consider how any debts you pay off yourself are going to be dealt with in respect of the house. Obviously if you clear x amount of money so the house is not sold, it is only reasonable that this should be recognised in either the ownership percentages of the property or a refund to you, with interest should you and your partner split up.

DavidHM

What you would want to do is get a trust agreement drawn up so that in exchange for the money now, your parents give you and your partner the property but so that it cannot be sold for as long as they are living there.

You cannot force them to bequeath the property to you: what you can do is make it so that the property is yours but they have the right to live in it.

However before doing that you have to think about what would happen if your parents wanted to move out; what would happen if you and your partner split up (and your partner wanted her share of the money tied up in the house); what would happen if your parents needed to go into a home or died within seven years of the transfer (e.g., a gift for IHT purposes if the property were sold at an undervalue) and what would happen if you or they ran up debts that required the house to be sold to pay them off.

All of those issues are surmountable but you and your parents will need independent, professional legal advice on those implications and how you would deal with them before going ahead with the purchase.