Help!!! Daughter wants help buying first house

scubaleopard

I am sure everyone knows this scenario. We love our daughter to bits and she is extremely hard working etc. etc.

We are about to retire and she has been in a relationship with a self employed carpenter who works extremely hard for about a year. We like this bloke , he seems extremely hard working and wants to make good BUT he has had a very difficult home life and is extremely tempermental. they row a lot ,not all his fault.

Anyway they have decided to buy together. A developement project of a run down house which is being sold by probate. Our daughter has asked us firstly to be gaurantors( we are extremely hesitant to embark on this route) and secondly to lend her money. Her partner has about £8.000 to put towards the project and our daughter has asked us to match this amount to be paid back when they sell the house.

What safegaurds would you recommend we put in place if we do lend our daughter the money i,e £8.000
I would be really grateful of any advice

Claudie

Your daughter is very lucky to have parents she is comfortable enough to ask to help. :T

I am not sure legally what happens, but a friend of mine moved in with her bf and his parents paid the deposit of roughly £20,000 - they had a legal agreement drawn up that said something along the lines of if and when the house was sold, the parents would receive their £20,000 before any other equity divided. I am sure there is something a solicitor could draft for you to cover all eventualities inc repayment etc

Snow_Dog

scubaleopard wrote: »

We are about to retire and she has been in a relationship with a self employed carpenter who works extremely hard for about a year.

What does he do at the end of the year, does he take a year out?:D:rotfl:

Seriously though, unless you want to enter into an official contract over the loan you are going to have to work on trust with your daughter.

That doesn't mean that you dont take her to see a good financial adviser, and make sure the house is in joint names etc.

I've always taken the view a couples accounts need to be transparent to each other, especially if going into a venture like this together.

scubaleopard

Sorry a bit of a misunderstanding --- they have been in a relationsip for about a yerr , He has been self employed for about 6 years

MrSmartprice

You could take out a charge on the property. Whatever amount you contribute, take ownership of that percentage of the purchase cost. That way, if it all goes wrong you would get that percentage back when the house was sold. If you had been paid back in the meantime, sign your share over to your daughter.

Make sure you get it all done properly by the solicitor who does the conveyancing, to protect your investment.

tomstickland

I detect caution.

Snow_Dog

I detect a bloke with wierd working habits, I prefer to work monday through Friday and have the weekend off, this working for a year lark sounds a bit full on. [tongue in cheek mode=off]

scubaleopard

This is silly . I made a mistake in punctuation. Our daughter has been with a carpenter for about a year and he does work extremely hard

Snow_Dog

Sorry, I was only joshing with you, its friday night after all, thats why I used the emoticons and [tongue in cheek] reference. Its called humour, I do try it out sometimes, doesn't always work, oh well.

And I did give what I thought was some sensible advice in post 3.

scubaleopard

Sorry Snow Dog -- thanks for advice and some humour but it is hard when the next generation are snapping at your heels!!!! Easier when they were in pushchairs shouting for the next bar of chocolate!!

tomstickland

I advise thinking about it for a few weeks before acting. Work out what will happen if they split up. Hopefully the house could then be sold for enough to cover the original loan. However, if were to be gutted at that point and not rebuilt it might be worth less.