Selling two houses and buying one with parent.

Jayne78

Hi, sorry if this is a common question, I can't find much on the search which relate to the circumstances we are in.
My Father passed away last month leaving my mum in a three bedroom semi on her own. She is in fairly poor health herself and they used to help each other out and myself and my sister would also support them.
I live with my husband and two children in our house which is owned but mortgaged. We are thinking about moving within the next two years. We have substantial debt at the moment, built up mainly because of my inability to work. However I have retrained now so am earning enough for us to be able to make quite large payments in order to pay the debt off within two years (if all goes to plan).
We have been looking at a few different options. My mum doesn't yet know if she wants to stay on her own but has made some suggestions that she would like to live with us (I don't want her to make any big decisions because it's been such a short time since we lost my Dad).
So, as I have a sibling, half of my mums house is hers when anything happens to my mum. At the moment her house is worth around £150000 and ours is worth around £130000. In around 18 months (which is when most of our debt will be paid off) we would get about £45000 capital from our property. Going on prices in the area at the moment, a house big enough to have the space required would be in the region of £260000.
My mum has said she would like a lounge, downstairs bedroom and bathroom to herself and maybe a small kitchen or would share our kitchen.
So, I'm just looking to see how all of this could work. I know we will both need legal advice if we decide to go through with it or even before we discuss it more fully. My relatives did this a while ago but there were no siblings so things were more straightforward. I just want to know how we go about ensuring my sibling gets her rightful share of the estate when anything happens to my mum, and how we stand if my mum were to need nursing care in her later years. I am planning to care for her at home but I'm aware that in some cases this becomes very difficult in circumstances where elderly people become very ill as they age.
I really don't like her being alone and think this may be able ideal situation so that she has company and care and less stress. At the moment she feels anxious that everything is her responsibility with the house etc now my Dad has gone and I think it would really help with this too but I want her to be completely comfortable and happy with everything.
I'm just looking for different options available to us such as would the new house be in my husband, me and my mums name or just my husband and mine and how would this affect things. And as i mentioned how do we ensure my sibling and myself receive equal shares of the estate when anything happens to my mum etc. I don't think we could afford to have a mortgage for the full value of the house (even with the small amount of capital from ours) so mum would need to pay something towards it to make it viable.

MrJB

What amount of money would your mum need to contribute towards the house? Would there be an equal amount of capital for your sibling? If so your mum could gift the equal amount of money to you, although if she needs care then the local authority may look to recover from you. If you are looking to buy with her as a joint owner but not being a mortgagee then the mortgage provider will have issues.

In my opinion it sounds pretty difficult, I'd speak to a decent mortgage advisor and solicitor.

Person_one

First of all, I think its very sensible to wait a year or two before even really considering this. The bereavement is very very recent, and the change to your mum's life is drastic. Making a big decision like this on the basis that she feels anxious on her own newly widowed would be rash, its absolutely normal and natural that she feels that way at the moment.

Secondly, while its considerate of you to be thinking about making sure your sister gets a fair share of any inheritance, I do think that should be secondary to what your mum needs and wants here and now, she's still alive after all and an inheritance is never guaranteed, or a right.

Support her in her own home for now (as long as she is safe and well there) and come back to the situation in 12 months to see how she's feeling.

pmlindyloo

If I am reading this correctly then you can't do anything about this for 18 months when you have paid off your debt? A lot can change during that time.

As you are aware it is extremely early days for your mum to be making any decisions and she is obviously feeling very alone and anxious.

Put everything on hold for the next 18 months until you know what your financial circumstances are going to be like.

In the meantime reassure your mum that you are there for her and will support her in the maintenance of the house. Make sure that she has any support services that she needs. Help her with her finances. (I am sure you are doing all this!)

I have known people who have made really rash decisions in these circumstances and live to regret it.

You don't say how old she is and what kind of health issues she has. Does she live near you?

Jayne78

Thanks all. She is almost 70 and has some pretty serious health problems including rheumatoid arthritis, osteoporosis and suffers some effects of a major stroke a year and a half ago.
I am really keen not to make any decisions yet. I agree it's way too early for her to know if she wants to remain on her own and it's not a good time to make any big life changing decisions.
I also have health problems which mean that long term I'm not sure if I will manage keeping two houses clean etc and if my mum requires lots of personal care such as lifting etc later on then we would have to consider carers or my sibling would need to support her also. This would be the same if she was living with us or not, I just think it would be easier to have her under the same roof where my husband can help out and I'm not trying to run two separate houses and driving her meals to her etc. She lives quite close at the moment, just a five minute drive so it's not a major problem, however having two young children and health problems myself I can see that it will likely put a strain on us.
I know that I'm probably thinking of things way in advance, I just want to be able to say to my mum that if she finds living alone either too much health wise, financially or if she is too lonely that we have looked into things and we have options for later down the line. I don't want to do this without looking into things first because if I do and then we find out its not viable it would be harder.
Money wise on my husbands wage without the debt we could get a mortgage for around £150000 (obviously this is based on now so things could change). I'm self employed so things are more complicated with me and we don't want to max out on the mortgage and risk getting into debt again, definitely want to avoid that. So I guess as a rough guide we would have around £190000 on our own as long as the mortgage was approved etc. So mum would need to pay in around £70000 based on a rough price of what's on the market now. The cost could possibly be lowered if we got a cheaper house which we could adapt to accommodate my mums and our needs.
The fairness to my sister is important, I know that thankfully my mum is still here and hopefully will be for a long time, my mum would however refuse to do this unless she knew that any money from her and my Dad's house would be split fairly if anything happens to her. And if she decides against moving in together I want it to be because she really doesn't want it and has adapted and is happy and coping with living alone not because she's worried about finances after she's gone.

xylophone

As you realise and as others have said, it is far too soon for your mother to be making life changing decisions.

Incidentally, now is the time for her to be considering LPA.

https://www.gov.uk/power-of-attorney/overview

It appears that at the moment she can safely live in her own home with your support/your sibling's support, when and where necessary.

However, it is perfectly clear already that she has problems which could lead to her needing a lot of personal care (but not necessarily what would be regarded as primarily medical care) in the future- this might need to be provided in a care home, particularly if you yourself are unwell.

As this is the case, selling her home and making a gift of the capital to you and your sibling, even though she would be sharing a home with you, might be regarded as deprivation of assets.

It might be best if you and your husband could stretch to buying a house big enough to give her her own large bedsit - a stairlift should cover any mobility problem?

She could then keep her capital which could be invested to give her an income to supplement her pension/Attendance Allowance etc so that she could pay her share of household expenses - it would also be there to finance any care needed.

She could make a will to leave you and your sister whatever remains at her death?

SmlSave

it would be easier to have her under the same roof where my husband can help out

Just check that your OH is 100% happy with this statement in a couple of years when you come to make your decision!

Lovely to hear you are looking after your mum

Jayne78

Thanks smlsave we've discussed it at length both recently and in the past!!!!
We were discussing it a few years ago when my parents health began to decline. My parents thought about it but decided to stay in their own home and made some adaptations to make this possible. They always said that they may reconsider in the future but obviously now my Dad never got the chance.

Mojisola

Jayne78 wrote: »

My mum has said she would like a lounge, downstairs bedroom and bathroom to herself and maybe a small kitchen or would share our kitchen.

Don't share the kitchen! Unless you are very well-matched in the way you use your kitchens, it will cause arguments.