Daughter Buying Me A House: Pitfalls? Advice?

Annisele

WoodruffsDad wrote: »

I appreciate that I have to give up my plan but it makes me quite angry that meddling bureaucrats can stop me from spending my hard-earned money exactly how I want to.

It's nothing to do with bureaucrats.

You can spend *your* money however you want. If you could afford the house outright, there'd be no problem.

However, you can't spend the *bank's* money unless the bank agrees.

zzzLazyDaisy

Annisele wrote: »

However, you can't spend the *bank's* money unless the bank agrees.

And this is your problem.

Most (all?) lenders will refuse to lend in this set of circumstances.

WoodruffsDad

Annisele wrote: »

It's nothing to do with bureaucrats.

You can spend *your* money however you want. If you could afford the house outright, there'd be no problem.

However, you can't spend the *bank's* money unless the bank agrees.

I think you're splitting hairs. The bank/building society would get their pound of flesh wouldn't they?

holly_hobby

But its nothing to do with bureaucrats - it is to do with lenders protecting their interest in the case of possession and you pursing the return of your capital injection, so its commercial law and your personal circs that are scuppering your plans for purchasing a home via your D.

Of course, your D could as I say could be conservative with the facts surrounding the purchase - but that would be a decision and consequences for you and your D to contemplate.

Hope this helps

H

somethingcorporate

It's the mortgage company taking the risk in this convoluted scheme and no wonder why they would not entertain it.

Have you explored getting a mortgage yourself yet? I do not think this beyond the realms of possibility.

zzzLazyDaisy

WoodruffsDad wrote: »

I think you're splitting hairs. The bank/building society would get their pound of flesh wouldn't they?

Not necessarily. There is a perfectly good legal argument that in buying the house with a gifted deposit from the tenants, that the tenants then obtain a beneficial interest in the property. This could mean that if your daughter defaulted on the mortgage repayments the lender would find it difficult or impossible to repossess. This means that the lender's charge over the house is potentially worthless.

It is for this reason that most, and possibly all, lenders will not lend against this type of arrangement.

Lenders have tightened up considerably on their lending criteria - remember the toxic debt crisis? You may not, but lenders certainly have.

WoodruffsDad

Another great annoyance to me is the conflicting advice which I have been given.

On this forum (and I believe the consensus that I cannot proceed with my "plan") I have been told in no uncertain terms not to go ahead. Thank you.

I have, however, also contacted 4 independent financial advisors each of which has told me that there is not a problem (legal or otherwise) and that they can get the mortgage I require all above board.

As a layman, who am I supposed to believe? Is it just that these financial advisors want to earn a quick buck in commission and to hell with the consequences?

Mojisola

[QUOTE=Yorkie1;58318187
If you have got formal advice elsewhere that you can pull the wool over the lender's eyes about either the source of the deposit or your residential status, then fine - go with them. They have professional indemnity insurance. [/QUOTE]

WoodruffsDad wrote: »

I have, however, also contacted 4 independent financial advisors each of which has told me that there is not a problem (legal or otherwise) and that they can get the mortgage I require all above board.

As a layman, who am I supposed to believe? Is it just that these financial advisors want to earn a quick buck in commission and to hell with the consequences?

If you have had professional advice from people with indemnity insurance and want to go ahead, that's your choice.

Personally, I would record what's being said in meetings to avoid the problems later where they insist you didn't tell them certain things otherwise they would never have advised you to go ahead with your plan.

holly_hobby

WoodruffsDad wrote: »

I have, however, also contacted 4 independent financial advisors each of which has told me that there is not a problem (legal or otherwise) and that they can get the mortgage I require all above board.

I assume you mean mortgage broker not IFA whom don't tend to be involved in mges.

If you have 4 advisors tell you this is perfectly acceptable, then why come back here asking for further assistance ?

WoodruffsDad wrote: »

As a layman, who am I supposed to believe? Is it just that these financial advisors want to earn a quick buck in commission and to hell with the consequences?

I hope thats not the case, more they are inexperienced in situations such as this, and are merely ASSUMING there won't be a problem as they don't understand the possessionary aspects of a gift with reservation as discussed.

My own comments come as a financial & mge advisor and someone with many yrs mge experience.

If you don't want to accept what we say here, then go with the advisors whom say no problem - afterall they have indemnity ins you can potentially claim off for mis-direction - whilst we have no ulterior motive, other than to share experience.

H

WoodruffsDad

holly_hobby wrote: »

I assume you mean mortgage broker not IFA whom don't tend to be involved in mges.

If you have 4 advisors tell you this is perfectly acceptable, then why come back here asking for further assistance ?




I hope thats not the case, more they are inexperienced in situations such as this, and are merely ASSUMING there won't be a problem as they don't understand the possessionary aspects of a gift with reservation as discussed.

My own comments come as a financial & mge advisor and someone with many yrs mge experience.

If you don't want to accept what we say here, then go with the advisors whom say no problem - afterall they have indemnity ins you can potentially claim off for mis-direction - whilst we have no ulterior motive, other than to share experience.

H

Why do you find it necessary to be so rude and nasty?

I HAVE accepted the advice given on here and I have said that I do NOT plan to proceed with my original intention.

For your information, of the people I contacted they all claimed to be independent financial advisors AND mortgage brokers and I contacted them BEFORE I posted on this forum.

In future, please get your facts assembled before going on the offensive.