Is this immoral?

DaftyDuck

In one way, I don't agree with some of the above and, as a child, my parents used money held in trust for me to help buy the family home.

In my case, my money was pretty safe, in that it was a small proportion of the house finances. My parents were also well able to pay it back over time. One significant difference was the donor and trustees were my grandparents, they were still alive, and they agreed.

The money, substantially increased, was returned to the trust 10 years later. The main benefit to me was I grew up in a rather wonderful house, and that's one of the reasons I still love large, old houses.

The most significant difference is my grandparents still being alive and, for me, that changes everything. Had the lot been lost, I wouldn't be begrudging now. In the situation you outline, I don't believe you should use the money UNLESS you have some legal backup for isolating thd money. A charge put on the house could be an option, but not if you are in need of a mortgage. If you do need a mortgage, there'd be direct conflict of interest.

robatwork

Yes.

And possibly illegal.

brodawel

It's a bad idea.

Potternerd

Thank you I really appreciate all the replies and you have made everything much clearer. I was thinking of repaying much sooner than DS is 21, but posters are absolutely right that investing in a property isn't a dead cert so not fair to gamble DS's money.

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bouicca21

You shouldn't even be asking the question. It is patently obvious that it is immoral.

Also if the projected property investment needs that kind of cash input then it probably isn't really viable. And that's before you include the additional risk of the project manager presumably being an amateur.

I'm always struck by those programmes on the telly that tells you how much capital gain a buyer/developer has made but never cost out the hours of work that went into getting there.

I bought my flat from just such an amateur developer. He was desperate to sell before his creditors closed in and started bankruptcy proceedings. Even on a rising London market he lost money. Property investment isn't the straightforward avenue to profit that some would have us believe.

Keep_pedalling

AnnieO1234 wrote: »

There are such things as Trust accounts which are irrelevant of age; and the trust (depending on it's set up) can make investments for the benefit of the trust. If it was solely the trust buying the property in the trust's name then the risk would be the Trust and it's trustees. However due to the mixed funding you're suggesting, I believe it would be argued that you weren't acting in the best interests of the trust but rather yourselves.

The problem comes with the risk involved. Could you look at a different investment vehicle or gift the property to the Trust so that it becomes the owner? Really you need to explore your options with an accountant or similar xxx

Trusts can be very expensive to run, especially for a relatively small sum of money. Adding clauses to the will restricting the distribution of a benificiary's inheritance to a certain age can be a real pain for the executors / trustees, which is why we have not done it for the modest amount we have left our niece and nephew (although they hopefully will be fully fledged adults by the time we snuff it)

The best option for the OP is going, to a large extent depend on the amount involved and the age of their son

basil92

G_M wrote: »

Much depends on PP.

If OR and SIS both agree, there is no need to PP (unless under 18), though TER cold be a problem in future.

Eh?? !!!!!!? :huh::think:

antrobus

robatwork wrote: »

Yes.

And possibly illegal.

Yes. Assuming the money is indeed in a Junior ISA then, nobody can make any withdrawals from that account until the child is 18. Unless that is the child dies or becomes terminally ill.

So the idea of taking the money out to invest in property is a non-starter.

G_M

basil92 wrote: »

Eh?? !!!!!!? :huh::think:

My thoughts exactly.

AnnieO1234

Keep_pedalling wrote: »

Trusts can be very expensive to run, especially for a relatively small sum of money. Adding clauses to the will restricting the distribution of a benificiary's inheritance to a certain age can be a real pain for the executors / trustees, which is why we have not done it for the modest amount we have left our niece and nephew (although they hopefully will be fully fledged adults by the time we snuff it)

The best option for the OP is going, to a large extent depend on the amount involved and the age of their son

I disagree that Trusts are expensive to run as the beneficiary of one and Trustee of another, but I suppose it's all relative.

Hopefully the OP will be able to consider all pros and cons xxx