Parent died, what next

lidlest

Hello, I would really appreciate if anyone could point me in the right direction with this. I have been going around in researching circles, as you can imagine I'm not in the straightest frame of mind.

My mother has died, leaving my dad alone in a sprawling house whose upkeep he can't keep on top of, however he is too fit and young to go into a home, he wants us to move in there. ( it has a granny annex which he would live in on the ground floor)

Now, I have no problem with this but I need to keep my finances secure for my family and not do anything dodgy in regards to future inheritance of my siblings or out my family at risk if dad needs to go into a care home at some point.

So the basics - I own my house, worth about £175,000... Mortgage of £99,000 left. My parents house is mortgage free, would be worth about £250,000 but in dire need of redecorating/ cosmetic renovation as it hasn't been touched since the 80s. I couldn't live in it without at least a new kitchen and decorating throughout.

Any advice on where to go from here much appreciated, ps no room to extend my property - can I convert my house into a guy to let, borrow extra money on it and renovate my parents? ( need to get my £20000 back at some point). Small mortgage on my parents house for renovation ? I'm happy to pay it, could afford it but don't even know how Togo about this

ratrace

Hi, Im really sorry to hear about your loss hope you are ok and your father to.

The obvious thing would be to get dad to move in with you depending if you have room and rent his house out

or you could sell his house and buy him a smaller one near you that way you could check up on him regular, and he can still have his independence

in regards to the future will he need to go in to a care home at some point and as far as i know if he has any assets ie: the home they might make him sell it to pay for the care home fees (don't know how it works now)

I agree i wouldn't do anything in regards to his money and inheritance espically if he has other kids (funny how money can cause all sort of problems between siblings)

Im sure someone else with help you further

jennifernil

If it was me, as long as Dad's house was somewhere I was happy to live, and if I could afford the larger mortgage, I would sell my existing house and buy Dad's house. Then renovate it to my requirements. I would expect to pay full market value.

That way, Dad has the cash to use if necessary, or to pass on in his will if he doesn't.

Skintmama

Please do take specialist advice, as there are potentially complex issues regarding inheritance, income tax (on rent) and capital gains tax.

This is something which we have had to start looking into and it seems to be a minefield for a layperson such as me!

Proper advice, although costly in the first instance could save money in the long run, not to mention problems with HMRC and the local council, should Care provision be required in future.

I am sorry for your loss and wish you luck in finding a solution which suits everyone.

BobQ

jennifernil wrote: »

If it was me, as long as Dad's house was somewhere I was happy to live, and if I could afford the larger mortgage, I would sell my existing house and buy Dad's house. Then renovate it to my requirements. I would expect to pay full market value.

That way, Dad has the cash to use if necessary, or to pass on in his will if he doesn't.

OP, this is an option, but there are other options.

Is your father content to live in the house, it must have lots of reminders of your Mum, would he consider leaving it? If so you could buy a house of a similar size that is up to the required standard, sell both your homes and jointly buy (as tenants in common) the new house? This will give you a smaller mortgage and a chance to save and be in a position to buy his share in the future. Also none of the building mess to deal with.

If he wants to stay put and you can afford an extra mortgage of say £60K, go to a solicitor and agree that you will take a quarter share of the property. he could then use the mortgage cash to renovate the house and improve its value..

Then move in and make your own house a buy to let. You would need to check that the rental income would pay for the costs (incl the mortgage)

You would have a home, and a tenant paying your mortgage, so effectively you would have a smaller mortgage. You would need to factor in the CGT liability on the BTL.

If your Dad needed to go into a home, you would have the option of selling the BTL and buying his share, or of moving back to your previous home.

Your siblings only gripe might be that your father is then only in a position to leave 3/4 of a better house rather than all of worse one. But you are the one making the sacrifice so it seems fair to me. In any case there may be nothing to inherit.