buy my parents house

max_daltry

hi my parents have sold their house to equity release, their house is worth 200k, equity release own 100k, can i buy it back, and rent it back to my parents,

00ec25

all you can do is ask whoever now owns it if they will sell it to you, expect to pay a lot more than 100K thou!

if you do own it then yes you can charge your parents rent and you will have to follow all the other legal requirements of being a LL inclduing paying tax on your rental income - see GM's post on what being a LL entails
http://forums.moneysavingexpert.com/showpost.php?p=41160642&postcount=12

However, since your parents presumably did equity release becuase they needed extra inciome themsleevs I fail to see how you cancelling out their income and replacing it with them paying you rent actually helps them at all???????

max_daltry

hi it is 100k with their fees, so there is 100k equity still in the property, will i be able to rent it back to my parents, if so who pays the rent as my parents are retired and have no money

DannyboyMidlands

Your parents will have £100k. That should cover the rent for a while.

00ec25

max_daltry wrote: »

my parents are retired and have no money

sigh!

so rather than helping your parents live a comfortable retirement you want to force them back into living hand to mouth dependent on state benefits so that you can line your own pocket

if they have no money then the only way they can pay yuou rent is to get state benefits. These will be means tested and the fact that they "sold" their property to you and are now claiming for rent becuase they have no income and have no assets/capital means it is unlikely they will get much in the way of benefit payments

your scheme to get rich at your parents expense needs rethinking

marliepanda

It is highly unlikely they will get benefits to pay you (their son) the rent of a house they just sold to you... Otherwise everyone would do that... As you have bought it solely to rent back to them it will be seen as a contrived tenancy.

They will have their money from the house sale, and that will have to be used to pay the rent if you want to rent it to them...

It sounds like you dont actually want to take money from your parents but get their benefits paid to you. It won't happen.

savingmummy

What do they want to do? Are they the ones suggesting you do this?

kingstreet

If you buy your parents' property for £200k, they will repay the Equity Release lender and have £100k left over.

This will mean they aren't entitled to any means-tested state benefits and will have to pay your rent out of their cash. Once this falls below the qualifying maximum, they may then be able to start to claim state benefits.

If you are considering buying their property for £100k and simply paying off the equity release loan, you risk them falling foul of the "deprivation of assets" rule should they require council-funded social care in the near future. They would similarly fail in any claim for means-tested state benefits as they would be treated as if they still had the £100k they "gifted" to you.

seven-day-weekend

Why haven't they got any money? Don't they have any pensions?

lighting_up_the_chalice

Even if you can make the capitol "disappear", LHA is not usually payable on a house you have previously owned for a period of 5 years.

If you intend to ease your parents worries and allow them to enjoy their retirement more at your expense, then good for you. I'm sure they will be both happy and proud.

If, however, you want the poor taxpayer to fund your inheritance and provide an income, think again. Both you and your parents may find out what a costly venture this can be.