sound advice needed!

bmw001

In short my elderly father is in financial difficulty. This has recently come to light. Approx 10 years ago he remortgaged for 35k to finance a property abroad, this was on interest only with the intention of paying off when property sold. However, his wife (not my mother) left him and took the money. Mortgage due 2015 he cannot pay. I can help him, my siblings cannot . I don't know the best way forward. Do I buy the house and rent back? Do I loan the money with interest attached? He is not divorced but going through a legal separation. If I loan the money its my life savings, I have a family too, a teenager n 25yr old and husband. My father is 82. Any advice welcomed.

Caz3121

Previous thread https://forums.moneysavingexpert.com/discussion/3339312

Has anything happened since?

bmw001

No he thought he could solve the problem and all went quiet until recently. My eldest sibling offered to help but since declined the offer to help, situations change I guess. I have offered to buy my fathers house at a fair price. He does have a very good pension plus he would have a lump sum to spend as he wishes, and to be honest I hope he does spend it!!

Caz3121

would the house be part of the legal separation? have they sorted out the finances? the last thing you want is to sort it out for him and then his ex coming wanting half of the equity

bmw001

Apparently she has agreed not to pursue the house, it was originally gifted to him many years ago by my grandmother. Its a mess and dad is whittling, I'm trying to make it easy for him plus keep my siblings (4) happy. The options, as I can see are either to buy the house outright and charge a low rent, I cannot afford not to, or pay the loan, ask dad to sign the house over and live there rent free, or loan the money with rolled up interest ........I seem to be going round in circles!!! Personally for my family would be better to buy and charge rent....is that unethical??????

Paul_the_Painter

They need to divorce before you settle anything else.
I would suggest a family conference afterwards, with options being put before them, as you don't want any hassle or accusations when the day comes to talk about inheritance, and your siblings find out that they haven't got one (potentially)

bmw001

He won't divorce, don't ask me why!! Sibling's are aware, all but one that is as they and my father are estranged, not worth broaching the subject with them as would just cause father distress. With regards to potential inheritance, the lump sum would cover plus more if my father choose to do so. Families eh!! I have never asked nor would expect anything monetary wise, I just want him to live stress free. My father's happiness in his remaining years are more important, yet saying that obviously I don't want to loose out financially as its quite a sum of money and our life savings.

Caz3121

How much is the property worth? is it £35k or more that is owing?
Does your father have enough income to pay rent? (he will not be able to claim any housing benefit)

bmw001

worth approx 90k owes 35k. His income would easily cover any rent.

bigadaj

You coud, look at a lifetime mortgage given his age. It's possible that if he has sufficient pension income he could try and extend the mortgage though I know it's difficult without a repayment plan in place, in these circumstances it might be better.