Mother lying about family loan

Jlc1983

2003 andy's mum (Jennifer) and dad (Paul) are getting divorced

Jennifer tells Andy and his brother Gavin that she wants to protect their inheritance so she buys a house (in their name) using money from her account (we think). So that money (40k) is safe. It's theirs. There is no charge on the house, nothing to say that the 40was a loan etc. it was done to protect their inheritence from the divorce settlement

She treats the house as her own...she pays the mortgage and collects the rental income. Mortgage is 180pcm, income between 450-600pcm. It's still in their name so basically when she dies its theirs anyway, no inheritance tax etc.

They fall out. Big time.

We discover, by chance, that she has put the house on the market. Had every intention of giving her the money until she sent letters demanding to know what Andy and gaz intended to do with the money, because she would take them to court if she had to. !!!!!!?! she was always going to get it. then it hit Andy and gaz that she used them to keep 40k away from their dad/out of the divorce settlement and that really razzed them off.

So, on completion of the sale the money goes 50:50 to Andy and gaz. They then split the money 50:50 between their mum and dad...they decided this was the fairest thing to do, that although they owned the property, that their mum had given them early inheritance, that she really never intended it to be theirs and, as such, it should have been in the divorce settlement.

Today....we get a letter. She is making out that she lent them 40k to buy a house and they promised to pay her back?!
This is utter, total, complete rubbish. But she is demanding the other 20k (which they gave to their dad)

But where do we stand, legally?

Vikipollard

Send her a prove it letter. Does she have anything in writing to prove she loaned them the money and they promised to pay it back?

jonesMUFCforever

No idea what is going on to be honest - the only thing to stick out to me is that if the loan happened in 2003 and no repayments have been made or asked it is statute barred.

Jlc1983

Thanks so, so much. Fingers crossed she will realise her sons did the right thing before she takes them to court!

dealer_wins

He said, but she said, but he said, but she said, but he said.....

Mojisola

Jlc1983 wrote: »

Jennifer tells Andy and his brother Gavin that she wants to protect their inheritance so she buys a house (in their name) using money from her account (we think). So that money (40k) is safe. It's theirs. There is no charge on the house, nothing to say that the 40was a loan etc. it was done to protect their inheritence from the divorce settlement

She can't actually have bought the house in their names - they must have signed all the necessary paperwork.

How did she get the mortgage if the property was in their names?

If the house was in their names, then wouldn't the rental income be officially theirs and shouldn't they have been declaring it?

antrobus

I'm a bit confused - "There is no charge on the house" but "Mortgage is 180pcm"?

Mojisola wrote: »

...If the house was in their names, then wouldn't the rental income be officially theirs and shouldn't they have been declaring it?

Well, yes it would. If the house was purchased in 2003 and had generated an "income between 450-600pcm" all that time, then 'Jennifer' would owe 'Andy and his brother Gavin' least £54,000 in that respect, whilst they in turn would owe HMRC £x in respect of tax, interest, penalties, whatever.

Jlc1983

House and mortgage both in their name. They signed all paperwork, of course.

No charge meaning there was nothing written into the deeds which would have meant that Jennifer would have been paid directly from the proceeds upon completion. Quite a common legal way of securing money.

Caz3121

so have the property owners been declaring the rental income to HMRC?

Jlc1983

No, they never took any from it, their mum kept it all. She had a few properties, that's her main source of income, so am guessing she paid the income tax due?

somethingcorporate

Without any proof it was a loan there is little to no chance of them getting any of it back.