Buying property for my niece

difficultguy

Hi guys,
I'm a tax payer and I got some savings from my own wage. I want to invest mymoney into a property market. My question is,

1) Can I buy a property on my (23years old) niece's name? She was born in UKand she is university student at the moment. Unfortunately, she doesn’t haveany personal savings and her mum is a single parent with no savings etc. I meanis there any legal challenge that any of us can face if I buy her a property?

2) Can I instead buy this property on my mum's name, who is living abroadand she is NOT British national? Can I later on live in the same propertywithout any legal challenge etc?

I will appreciate your suggestions/advices
Regards,

Fire_Fox

Welcome! What is the purpose of this? No you cannot buy property in someone else's name, you can gift or loan them money and they can buy property. You can live in the property if the rightful owner (niece or mother) gives you consent to. If any mortgage is required it will have to be in the owners name.

If you live in the place you may be classed as a tenant, the owner may have ALL the legal obligations of a landlord, tax may be payable on any rent, the owner may not be eligible for any means tested benefits and many other issues. It won't be an investment for you unless your niece or your mother borrow the money and pay you interest, can they afford to and what is the benefit to them?

difficultguy

Fire_Fox wrote: »

Welcome! What is the purpose of this? whatis the benefit to them?

1) I got some spare money sitting in my saving accountsand it has been losing its value. I am about to get marry and it’s not worth torisk my savings, just in a case....
(I think this reason is valid enough …..)



2) (you can gift or loan them moneyand they can buy property.)

My mum is living abroad and I will have to pay bycheque and it is going to be a low investment property (max £50k value). I haveto do all the paper work. I will appreciate if you can tell me how exactly Ihave to do it.

3) I will get letter of consent from my mother to use thisproperty as long as I want. thats not a problem... Oh yah, I know that I willbe classed as a tenant and I will be liable for all bills and outgoing etc



4) (the owner may have ALL the legalobligations of a landlord, tax may be payable on any rent,)
What sort of legal obligation you are referring to?
If this transaction goes through, I will be living in a property without payingany sort of rent. Is there is any sort of legal issue here?



5) If I put this property on my niece’s name, what sort oftrouble she could get from student finance or benefit office. Its 100% securemoney which will come from my bank account.

Fire_Fox

Your mother or your niece needs to buy the property, if your mother is abroad and not going to be in any way involved, that sounds like you trying to use her name NOT her buying the property. If you gift the money to your mother or niece how are you going to get it back?
http://www.hmrc.gov.uk/international/nr-landlords.htm
http://forums.moneysavingexpert.com/showpost.php?p=41160642&postcount=12

We are not legal advisors here, you need to do your own research about the implications - get a solicitor - for your mother and for your niece's student finance. Your niece will not be eligible for any means tested benefits or any means tested student finance if you give her a large sum of money, if she claims it would be fraud. There are other more straightforward ways to safeguard your money from your wife to be.

difficultguy

Fire_Fox wrote: »

There are other more straightforward ways tosafeguard your money from your wife to be.

I think, instead of getting things too complicated for me, why don’t youtell me any other easy way to safeguard my money, which I am most likely goingto invest on the property.

My all savings are genuine which I earned over years of my hard work and Iwill appreciate your help.

moromir

You do realise that the property will very likely become an asset of the marriage anyway the longer you remain married? And thus liable to being part of any subsequent divorce settlement (which I presume is ultimately what you hope to avoid).

Annisele

You can give money (or property) to whoever you like. But once you've given it away, it isn't yours anymore. So, if you buy a house and then give it to your niece, your niece has a house but you don't.

If you give a house to your niece and then live in the house, you've potentially created a "gift with reservation" (google it). That can have inheritance tax implications, and the fact that the niece has a house she doesn't live in may have capital gains tax implications for her.

I think the best answer is the one Fire Fox has already given you. This forum isn't for legal advice, and it sounds as though you need a solicitor.

difficultguy

moromir wrote: »

You do realise that the property will very likelybecome an asset of the marriage anyway the longer you remain married? And thusliable to being part of any subsequent divorce settlement (which I presume isultimately what you hope to avoid).

Yes you are very right. I have been bitten once that’s why I am looking forsome safeguards, if possible...

difficultguy

Annisele wrote: »

it sounds as though you need a solicitor.

Is there any easy sloution for this mate?

Fire_Fox

difficultguy wrote: »

I think, instead of getting things too complicated for me, why don’t youtell me any other easy way to safeguard my money, which I am most likely goingto invest on the property.

My all savings are genuine which I earned over years of my hard work and Iwill appreciate your help.

I've suggested what to do, seek legal advice for the most appropriate way to safeguard your money.

difficultguy

Fire_Fox wrote: »

I've suggested what to do, seek legal advice forthe most appropriate way to safeguard your money.

I think the solicitor will laugh if I ask him about the possible consequencesof divorce before marriage.:)