Nationwide - borrowing more to gift to sons ?

densol_2

When I plan to do this ( next year) I'd imagine my mortgage balance will be around £240,000

No other loans / debts

The website seems to suggest they lend for many things. Is simply a gift to my children one of the reasons ? Is it really that simple ?

I want to gift now, im a single mum with only a single IHT allowance

getmore4less

There are probably better ways to mitigate IHT.

With sufficient excess income gift the house and full market rent may be feasible.

Creating debt and gifting may impact any gift from income exemption you plan to use.

You need some expert advice because this is going to be easy to make mistakes that don't help the IHT issue.

.

dimbo61

Do you really need a £850,000 house ?
Could you trade down to a smaller or cheaper place in a different area ?
How do you plan on clearing a £240,000 or even £340,000 mortgage in 15/17 years !
Taking you to state Retirement age.
Why not sell up and buy a £400/500,000 property now and gift your children £50,000 each.
Keep the rest as savings for you to enjoy.
Work if you want too not because you HAVE TOO.

Keep_pedalling

Downsizing and getting rid of the mortgage would be the sensible thing to do. That would leave you with a lot of surplus income that you could gift to your children on a regular basis. Gifting surplus income stays out of your estate so no need to rely on the 7 year rule.

densol_2

Hi all, many thanks for thoughts.

No moving is not an option at all. Ive just spent thousands upping the spec on my house which ive had for 15 years ( built new to my requirements ) its a large unique house, and getting the injury benefit till I die means I'll always be able to pay the mortgage and never have to move. I dont need it but I "want" it . Its a lovely feeling never wanting to move again. I dont want to transfer it to them either. They would both be socond home owners then and still not have ready cash available for deposits.

The house will have to be sold to pay some IHT when I die anyway. Ive got a term agreed till aged 75 already. Its really just giving them a bit of the equity now. I can easily afford the extra mortgage. Even not working I save £2k a month. When I get a job, I'll have £4k spare.

I just dont spend money. I shop at bootsakes and charity shops and travel economy. Always have always will.

By borrowing it - I reduce my net assets a bit for IHT, as long as I live towards 7 more years.

If I dont go with Nationwide Im thinking I might well need a broker ?

Thrugelmir

densol wrote: »

I get £60k a year NET ( its tax free ) injury pension - payable permanently till I die

Presumably this is paid to cover outgoings. Not just now but increasingly so in the future.

densol_2

Thrugelmir wrote: »

Presumably this is paid to cover outgoings. Not just now but increasingly so in the future.

No its paid to compensate me for loss of income due to injury. It increases each year in line with inflation ( if that increases )

My state pension will kick in at 67 as ive paid 34 years NI stamps since 16