Right To Buy Advice

puzl

Hello,

My situation is as follows. Me and my mum/dad have lived in our house for 30 years. It was formerly a council house (of which we paid rent directly to the council) but was bought by our local housing authority in 2002. Since then, we have paid rent directly to them instead. Prior to moving in here, my parents also rented another house from the council and have a combined total of around 38 years renting.

I have lived with my parents for the entire time I have been at our last house (30 years) but my name was never listed as a tenant.

When I spoke to my local housing authority about RTB, they said that as long as I have lived at the house for 12 months, I can make a joint-claim with my parents, when it comes to actually buying my home, but cannot make the claim myself, as I am not a tenant.

My dad and I are fine with doing a joint-purchase, though the cost will be paid for completely by myself, probably through a 5-year mortgage, but also with the possibility of paying it off completely in cash, assuming I could afford it.

My dad agreed that I should have sole ownership of the house (as I will be the one paying for it), but obviously since I cannot apply for the RTB discount by myself, he is forced to be involved and share initial ownership of it. My question is, once we do go ahead with the joint claim, how easy is it to change the deed so that the house belongs only to myself? I assume this would also take 5 years, as councils/local housing authorities don't allow you to sell the house and keep the discount until this time passes, right?

Just to add, we don't actually have any intention to sell the house anyway. It's our family home and they'll continue to live with me, albeit with me as the tenant. I'm just thinking about the future, as they are aging in years now and I would like to invest my money wisely, with the security of a home that I could eventually make a good profit on later, if required.

Thanks for your assistance.

Bluebirdman_of_Alcathays

https://forums.moneysavingexpert.com/discussion/5506498

puzl

Bluebirdman_of_Alcathays wrote: »

https://forums.moneysavingexpert.com/discussion/5506498

With respect, this persons situation is quite different to my own. I have lived in this house personally for 30 years. Although my name is not on the tenancy agreement, I have always been listed as living here and pay half of our current rent. This house is my home. I'm not buying it to make quick money or pay off existing mortgages. I am buying it so myself and my family have the security of knowing the house is finally ours and so they can save a lot of money on their pension now having to pay rent any more, as well as saving me a couple of hundred pounds rent per month.

AdrianC

I don't see how this increases security for your parents.

If your parents are joint owners of the property, and need residential care, they may well find they need to contribute to the cost of it, whereas as tenants they don't.

If you hit financial problems, your parents may find themselves homeless.

If you're concerned about their day-to-day affordability of the rent, then are they receiving all the benefits they may be entitled to? Can you afford to pay more towards the rent?

puzl

AdrianC wrote: »

I don't see how this increases security for your parents.

If your parents are joint owners of the property, and need residential care, they may well find they need to contribute to the cost of it, whereas as tenants they don't.

If you hit financial problems, your parents may find themselves homeless.

If you're concerned about their day-to-day affordability of the rent, then are they receiving all the benefits they may be entitled to? Can you afford to pay more towards the rent?

This is why I would want to remove their joint-ownership of the house ASAP after purchasing, to put it solely in my name. If in the unlikely event that they did need residential care later, they would not have the house as an asset to contribute costs towards it. However, they both have pretty decent pensions and would never be in a situation where they would be homeless. In the absolute worst case scenario, they would just rent privately from someone else and likely claim help with rent via housing benefit anyway. Assuming I moved with them, I'd simply pay the rest.

Can I afford to pay more towards the rent? Of course, but I intend to buy the house so that we don't need to pay rent any more! That's the whole point.

AdrianC

puzl wrote: »

This is why I would want to remove their joint-ownership of the house ASAP after purchasing, to put it solely in my name. If in the unlikely event that they did need residential care later, they would not have the house as an asset to contribute costs towards it.

No, but they would have deprived themselves of that asset, assuming they gifted you that part ownership - so it would still be taken into account.

puzl

AdrianC wrote: »

No, but they would have deprived themselves of that asset, assuming they gifted you that part ownership - so it would still be taken into account.

Can you cite a source for the legality of this please? I just find this very unlikely, as they wouldn't have the mortgage in their name, nor would they fund any part of the housing purchase itself anyway. I'd love to read other experiences people had, where other family members are forced to give up homes in their name to pay for services like residential care for their parents. It just seems legally very shaky indeed.

Bogalot

puzl wrote: »

Can you cite a source for the legality of this please? I just find this very unlikely, as they wouldn't have the mortgage in their name, nor would they fund any part of the housing purchase itself anyway. I'd love to read other experiences people had, where other family members are forced to give up homes in their name to pay for services like residential care for their parents. It just seems legally very shaky indeed.

Just search for deprivation of capital, there are plenty of resources available.

Your father may not be funding the repayments, but he is the one entitled to the discount. Without him there would be no purchase.

AdrianC

puzl wrote: »

Can you cite a source for the legality of this please?

Deprivation of assets is a very well-established principle - for very obvious reasons, if you think about it.

as they wouldn't have the mortgage in their name

Good luck finding a lender who'll allow only some of the joint owners to be on the mortgage.

I'd love to read other experiences people had, where other family members are forced to give up homes in their name to pay for services like residential care for their parents. It just seems legally very shaky indeed.

The liability wouldn't arise because of YOUR joint ownership, but because of THEIRs. You would not be being expected to fund their care - they would be being expected to use their own assets to fund their own care. Half of the equity in the property would be their assets.

xylophone

It is likely that all three names will need to be on the mortgage - even if not you and your parents would still own the home either as tenants-in-common or as joint tenants.

If the house were later transferred into your sole name, your parents would be deemed to have made you a gift?

http://www.ageuk.org.uk/Documents/EN-GB/Factsheets/FS10_Paying_for_permanent_residential_care_fcs.pdf?dtrk=true%5D


http://www.ageuk.org.uk/Documents/EN-GB/Factsheets/FS40_deprivation_of_assets_in_the_means_test_for_care_home_provision_fcs.pdf?dtrk=true

puzl

If the mortgage company wouldn't allow just my name, then I'd simply pay it in cash. Thankfully, I have saved enough capital to do so, though obviously a small 5-year mortgage would have been preferential, simply so that I had more in savings.

Those links you posted don't work for me, but in theory, wouldn't I be able to "buy" my fathers share of the asset? Much like purchasing a house from someone, wouldn't they then no longer have any claim to the asset?