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Taking over my dads mortgage??? Help!
Stanmayes349
Posts: 2 Newbie
Situation
house value £110,000, £25,000 has been paid off. My dad who is 59 has a mortgage until he is 70 to pay this off. Roughly £600 a month
He has no other savings and about 7k of personal debt. In his line of work he has to re-take his test every year once he reaches 65.
My concern is that he wont be able to work, not pay mortgage, lose house which will prove costly.
My proposal is that i take over everything (including the amount he has paid) and he pays me £400 a month rent leaving him £200 a month to pay off his personal debt. I will end up owning the home, he will have £200 a month spare to live on/enjoy/pay off personal debt/save for retirement. Im also proposing that when he does retire, i will pay him £20 a week (i.e. pension) (pay back for the 20k equity he will give me)
Is this a good idea? from his perspective and mine? any advice please
house value £110,000, £25,000 has been paid off. My dad who is 59 has a mortgage until he is 70 to pay this off. Roughly £600 a month
He has no other savings and about 7k of personal debt. In his line of work he has to re-take his test every year once he reaches 65.
My concern is that he wont be able to work, not pay mortgage, lose house which will prove costly.
My proposal is that i take over everything (including the amount he has paid) and he pays me £400 a month rent leaving him £200 a month to pay off his personal debt. I will end up owning the home, he will have £200 a month spare to live on/enjoy/pay off personal debt/save for retirement. Im also proposing that when he does retire, i will pay him £20 a week (i.e. pension) (pay back for the 20k equity he will give me)
Is this a good idea? from his perspective and mine? any advice please
0
Comments
-
Messy.
Possible capital gains tax implications for you when you come to sell.
Possible deprivation of assets issues (google it).
Possibly income tax liability on the rent.
Mortgage lender may not be keen, so may push you towards a buy-to-let deal which will cost more.
Selling up and renting may be a better option for him, freeing up a capital sum to repay debts.0 -
If this is your dream house, let him sell the house to you at a fair price, and then he stays with you free (but pays the utility bills, food, etc).
Otherwise, I'd advise seeing a solicitor (and maybe your bank) as things could get complicated.0 -
Do you live with your Dad?
I agree with the others; this is potentially very messy indeed.
If he sells his house to you for £80k, then he'll be vulnerable - you might decide to chuck him out, or go bankrupt, or get married and then divorced, or die, or have some other catastrophe occur. Plus, he'll have given you £25k (so deprivation of assets issues), and there are plenty of tax issues with that plan.
Is he struggling now, or are you concerned that he'll struggle in future? Can you afford to help him by gifting money to him?0
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