Buying parents home

cherie63

MIL died last week and now the subject of the family home has come up. FIL who is in good health has a good pension of about £1000 per month and no mortgage. After paying all the burial costs will have about £5000 in savings left.
The house is only worth between 70 to 80k and needs some money spending on it but hopefully nothing drastic.
His son and daughter are thinking about giving him 50k between the two of them and letting him live in the house until he passes away. From reading different posts and info on HMRC don't think it will attract IHT and that the pension would cover care home fees in our area.
Please any information would be helpful

MrRee_2

Buying parents home title and then you make very little sense in your post ....... repost or no-one knows what you are asking?

Yorkie1

Have you checked the actual care home fees, for decent homes, for your area? £1K a month seems very low from what I've read on here.

To be honest, from what you've posted, I think the plan stinks. Two of his children are planning on diddling him out of 25%+ plus of the home's value, leaving him with absolutely no security of ownership at all (the house would form part of the childrens' assets so at risk in the event of divorce, bankruptcy, CCJs etc).

Leaving that aside for a moment, would a mortgage be required? If so, the plan is in all likelihood a non-starter because he remains resident post-completion.

Leave him in his home, with his present security of ownership.

Annisele

Couldn't the children just lend him money (possibly secured on his home) at low or no interest?

Buying it for less than the market value can cause all sorts of problems. At a minimum you're probably creating yourselves a capital gains tax liability, and putting FiL's security at risk.

ognum

Father will also have money in savings if children buy his home and may effect Benifit payments if it is over the threshold!

Are the children ready for all the responsibilities of being their fathers landlord with all the checks etc that go with that?

Dunroamin

His wife's only been dead a week and now the children are planning to cheat him out of part of his home - quick off the mark by anyone's standards!

outofmoney

What is FIL planning to do with the savings? Assuming none of the above happens and he still has the money when he sadly goes, surely the money will just go back to son & daughter. So then they have property and money. Can't they just wait and inherit the property when he has gone, or is this to try and avoid taxes?

globetraveller

Poor FIL. Hit him when he is at his most vulnerable. If his own children are at all interested in helping they will give market value for the house. And even then there are so many pitfalls
With this arrangement, FIL will lose all security. With both children involved in this there is a double chance( if they are both married) that any divorce will result in a very messy situation.
Hopefully FIL will tell them what to do with their "kind" offer

cherie63

Maybe I have worded this wrong in the first post
The FIL has actually suggested this. He wants 12k to buy MIL mobility car but after paying all of the funeral cost will only have 5k left. So 7k is required to pay for the car. The car has to be paid for within the next week. His daughter thinks the car is a good idea but the son and myself cannot see the logic in paying that much for a car he needs to find 7k for it
His pension would cover the fees in our area I know this to be a fact as I was administrator in one of the best around here
To be able to give the FIL the 50k he wants each of the children will have to lend on their own properties
He did suggest using an equity release company to get some money but the house is of such value that I do not think they would give him anywhere near what he wants
He would live in the house as neither of the children would be as heartless as that

globetraveller

right- didn't realise FIL asked for this.
£12000 for a car is a lot. Surely he doesn't need to spend that amount? He could get one for half that or less. I think it would be kinder to not find the money to help in the next week and let it go. He won't be thinking straight at the moment.
If the house has to be looked at - why not a three way ownership? If he wants 50k and its worth 75k then that would make sense. You would inherit his third eventually.

princessdon

cherie63 wrote: »

Maybe I have worded this wrong in the first post
The FIL has actually suggested this. He wants 12k to buy MIL mobility car but after paying all of the funeral cost will only have 5k left. So 7k is required to pay for the car. The car has to be paid for within the next week. His daughter thinks the car is a good idea but the son and myself cannot see the logic in paying that much for a car he needs to find 7k for it
His pension would cover the fees in our area I know this to be a fact as I was administrator in one of the best around here
To be able to give the FIL the 50k he wants each of the children will have to lend on their own properties
He did suggest using an equity release company to get some money but the house is of such value that I do not think they would give him anywhere near what he wants
He would live in the house as neither of the children would be as heartless as that

Surely he buys a cheaper car