Buying deceased father's property

Warrior93

I am one of 5 surviving children and my deceased father wished for his house to remain "within the family". The option we have all agreed to is if I raise the money via a mortgage to pay my siblings their share. I have read that there is a way of possibly doing this called 'A Deed of Family Arrangement or Variation" which would need to be registered at the HM Land Registry. . I am going to apply for Letters of Administration as there is no will and apart from the house the estate is straightforward. We will be obtaining valuations of course. My main question is - do we have to employ a solicitor to execute the transfer of ownership document from all 5 of us to myself ? They would all be issued with their share immediately. I believe some kind of witness must need to be involved but is at as straightforward as it sounds.

RAS

You can either transfer the house from the state into all 5 names and then buy it off the other 4 or you can buy it off the estate and the estate can distribute the cash to the other 4 siblings.

There is a land Registry rep on here who can advise if you can do this yourselves.

Warrior93

Hi thanks for quick response. How do i contact the Land Registry rep please? The two ways you have suggested, is one going to be quicker/easier than the other?

RAS

pm this poster
Land Registry representative - on line at the mo.

personally I would have the estate sell to you and tyhen distribute. Otherwise you get the joy of one of the owners deciding to take a holiday, dying, or just deciding to pay hardball at the last minute.

BUT you need to pay the agreed market price so they all get their fair share and are confident about it.

Warrior93

Hi that sounds sensible. So can i ask you a further question then. Just for example if the house is worth 100k do i have to raise only 80k to put into the estate and not the full amount? Not sure if that question is worded clearly but what i am basically saying is that it will it be recognised that my share is within the equity?

JimmyTheWig

That's a good question. In effect, you want the estate to lend you your portion before everything is dished out. I have no idea what the answer is, I'm afraid.

Warrior93

Hi i wonder if anyone does know whether i have to raise the full purchase price to add to the estate and then pay myself my share back in effect? Does a solicitor need to be involved ?

Land_Registry

If the property is in England & Wales and is registered then the change of legal ownership can be done without the need for a solicitor.

The issues around 'who gets what' and A Deed of Family Arrangement or Variation are not matters with which Land Registry would be concerned and are I assume often resolved with the assistance of a solicitor - for that reason you will often find that the registration aspect is also completed by a solicitor.

To change the legal ownership you will need to obtain Letters of Administration as you already appreciate (Probate in other circumstances).

The administrator is then empowered to deal with the legal title and either Assent the property to the beneficiaries or Transfer it to a third party.

Our Public Guide 9 explains the options available to you - in the circumstances as explained it would appear that section 3.2 is relevant for you.

NB 1 - if you intend to raise a mortgage against the property (whether to pay off the other 4 or not) then the lender may well insist on you using a solicitor/conveyancer

NB 2 - You could change the legal ownership and then look for a mortgage but you may wish to discuss this with the other beneficiaries as the change is dependant on the mortgage it seems and you may all feel doing the two at the same time is the best way to protect everyone's interests.

Warrior93

Thank you so much. This is a very clear answer to my questions and i will indeed follow your advice. Things are so difficult when there is no will. I feel I have no time to grieve as I have a sense of duty to my siblings. i strongly recommend that anyone reading this who anticipates finding themselves in the same situation I am in should strongly urge their next of kin to do the right thing.

Fire_Fox

Please do not try to DIY a house sale/ purchase even if your lender will permit it, if you get any of the documentation wrong you will have an absolute nightmare when you come to sell or transfer on.

You need to speak to your mortgage broker and chosen lender about the deposit issue, it's not that different to a gifted deposit system lenders will have seen similar circumstances. Do be sure to have a full structural survey completed unless the house is fairly new, that will give you a proper idea of its value and any costly hidden problems.

I would think VERY carefully about being administrator given you are the one purchasing the house. As admin you will need to get everything valued and are responsible for getting the highest possible price. As purchaser you do not want to overpay you want a reasonable price (and maybe cannot raise the funds anyway if the house is overvalued). This sort of conflict of interest can easily lead to problems within a previously happy and trusting family. I would suggest one or two of your siblings act as administrator(s) and you simply act as beneficiary and purchaser.