Protecting my parents investment property in a divorce

Thegirl

From your friend's wifes point of view this is how things stand:
Her family home is one shared with her in-laws that is owned by her in-laws. So should she split up with her husband she will presumably be homeless. However, her husband does own a property which is currently rented out....

What do you think any solicitor worth their salt is going to advise her to do? Go after the property would be my guess.

I am also not sure that having never benefited from the house will be an arguement.
It was an investment property presumably. Rented out and covering the mortgage. It's not that unusual to not benefit from such an investment on paper until the property is sold. You keep your tax bills down by offsetting costs.

As others have said, he needs legal advice. I think he's going to struggle though.

zzzLazyDaisy

rpc wrote: »

If you put it into trust now, that doesn't mean that the value will be excluded from the divorce settlement. It might, it might not.

Putting that property in trust now will not (on its own) exclude the property from the divorce settlement. OP will still have to show why the parents have a beneficial interest and that as legal owner he was, in fact, a mere trustee for his parents all along.

Of course that could unravel all sorts of issues. Especially if either of the parents have since gone into care, or are on a debt repayment plan, or bankrupt, and haven't declared the fact that they are the 'real' owners of an undisclosed property. And of course OP's disclosure that he is just holding the property in trust for his parents, does mean that it will fall into their estate for IHT purposes.

It's a tangled web. But one that his wife's solicitor won't be too worried about - they will go for the legal title and I suspect his solicitor will advise him to come to an 'amicable' settlement rather than take any dirty laundry to court...

Dunroamin

I'd be keener on protecting the wife than the husband, it sounds as if they're trying to stitch her up.

skintandscared_2

Agree with Dunroamin. You say she's never worked - probably because she stayed home to bring up and take care of their children!!! How dare he now try and hide anything of value so she's left with nothing.

securityguy

I'm always mystified as to why people agree to these sort of "just put your name on the paperwork, it'll be OK" schemes. It strikes me that anyone clever enough to do it safely is clever enough to not do it in the first place.

Rottensocks

Legal advice would be the way forward: wife will be left homeless in a divorce as they currently live with the in laws.... and there would be a certain legitemacy in her claiming that she should not be made homeless by a seperation that leaves husband still living with mum and dad, but with a perfectly good flat down the road standing empty.

Also, where would the kids from the marriage live? On the streets also, or remian with the in laws?

Anotehr reason for getting good legal advice is that if you change the ownership status of the flat now (trusts, sales or whatever) surely you are giving good grounds for the wife to claim that it was disposed of just prior to the divorce in order to deny her the benefit..... it would ring alarm bells if my soon to be ex suddenly started putting proprty in trusts etc!

jamesd

He really needs personal legal advice that can consider all of the facts, like how and when money moved around between people and why he thinks the parents own it when it's apparently him at the Land Registry.

locotoro

Rottensocks wrote: »

Good points....
So, if it top it up when neededcounted as a marital asset, I suppose son relies on being able to provide real compelling evidence that shows he's not benefitted from the rpoperty at all?

A: would son be able to show that all mortgage deposit and payments were made by the parents?
B: Has the flat ever been the 'marital home' to son and his wife?
C: Would son be able to show that his parents collected all the rent from the property, not him?

I'm making the assumption that if the couple and their kids live with his parents, that there isn't any other proprty to split...which I suppose makes it all the more likely the wife might 'go' for a share of this flat?

Thanks for all your responses.

Just as some additional background - the son lived in the house as a child and his parents bought a new family house when his was a teenager. They rented the house out and when he later got married the couple lived in the new family home with the parents whilst the old house was rented.

The parents then needed to remortgage due to finances and due to their age decided to remortgage the old propertty on his name. The monies for the property have been paod entirely paid by his parents. She has never had any link to the old propert

The rental income covers the mortgage and the parents top. Hes anxious that she might try and go for it if worse comes to worse because the property is supposed to be divided between him and his siblings.

Any suggestions would be great

zzzLazyDaisy

locotoro wrote: »

Any suggestions would be great

I suggest you read the responses already given. The information you have just given does not change anything. You are the legal owner of the house, your name is on the deeds, and the mortgage is in your name. As such it is a matrimonial asset and you will have to declare it as an asset in the divorce on Form E. You are right, she will almost certainly be advised to make a claim on the property, and on the basis of what you have said so far, my money would be on her getting a share of it.

You need to see a solicitor and get independent legal advice.

Edit: for 'you' read 'your friend'

locotoro

Dunroamin wrote: »

I'd be keener on protecting the wife than the husband, it sounds as if they're trying to stitch her up.

That assumption is completely inaccurate.

She came from abroad with no education and no responsibility. They got married and he has lavished her with all the money in his pocket and his parents are constantly buying her gifts. After 15 years of marriage and three kids she has never had a single money worry and is very lucky. considering both me and my wife both earn more than my friend but we both have to work to pay mortgage and she doesn't because of his parents. Turns out shes not as appreciative as she used to be and not having a clue about finance or working she wants more.

Nothing in their situation closely resembles stiching her up. He would quite happily support them if it came to it because of his kids but he doesn't want to jeopardise his parents property.

Additionally when I say the parents own the property I mean that they should own it in equity by virtue of the fact they pay for it and it was their home for 30 years