Selling a house for cost

mrginge

Daughter becomes exposed to -
Capital gains
Higher rate sdlt
Income tax
Landlord responsibilities

OP is exposed to -
Deprivation of assets
Loss of security


why doesn't the daughter just pay your mortgage?

KRB2725

My friend moved 200 miles away with her family to be able to afford a large enough home for them to have her sick mother live with them.

It worked perfectly for the first three months and then very sadly, the care needed for her Mum became above what someone unqualified could offer. Her Mum had to go into a care home very shortly afterwards.

Whilst it is lovely that your daughter is willing to take you, it may not be possible for her to do so and if you go through with your plan it could leave a lot of financial mess to be unraveled.

Pixie5740

mrginge wrote: »

why doesn't the daughter just pay your mortgage?

K.I.S.S. I like it mrginge :grinheart

marksoton

kdb550 wrote: »

Thanks for the response but I like to think positively about these things and was only interested in the legal and tax side of things rather than worry about the what ifs. If I thought like that what would be the point of getting up in the morning.

What a foolish attitude.

gettingtheresometime

mrginge wrote: »

Daughter becomes exposed to -
Capital gains
Higher rate sdlt
Income tax
Landlord responsibilities

OP is exposed to -
Deprivation of assets
Loss of security


why doesn't the daughter just pay your mortgage?

Because conversely she could pay off the mortgage in the anticipation of inheriting the house, only to find the OP has left it to the dog's home

G_M

This has disaster writeen all over it.

Financially and personally.

Mojisola

gettingtheresometime wrote: »

Because conversely she could pay off the mortgage in the anticipation of inheriting the house, only to find the OP has left it to the dog's home

Not if the payment of the mortgage is set out on paper as a loan against the house. Daughter would be guaranteed to get her money back (plus interest if that is set out in the paperwork) when the house is sold whether that is to pay for care or after death.

mrginge

gettingtheresometime wrote: »

Because conversely she could pay off the mortgage in the anticipation of inheriting the house, only to find the OP has left it to the dog's home

Second charge or loan agreement as mojisola says.

Much better ways to resolve this than what is proposed.

steampowered

I don't see any real reason why you can't do this. You should get a solicitor to help you but it sounds perfectly achievable to me.

You would effectively just be selling the property to your daughter at a lower value than the house is actually worth. You can do this. However you may find that there is a capital gains tax liability if the sale is treated as taking place at market value.

In terms of protecting your interest in the property, you could consider (1) taking a life interest in the property which entitles you to stay there for life, or (2) a long lease which terminates on your death.

If you want to pay your daughter, you can simply pay your daughter money every now and then as a gift. It doesn't need to be rent linked to the house.

Contrary to what other posters have suggested, I don't think this would result in your daughter being treated as your landlord and you as a tenant.

Contrary to what other posters have suggested, I don't think this would be seen as 'deprivation of assets' for the purposes of means testing care home expenses. In order for 'deprivation of assets' to apply a significant factor in the reason why you sold the house must be to avoid care fees. That is not your motivation so I think you would be OK.

Also, even if you were seen to be trying to deprive yourself of assets to avoid care fees, you wouldn't be any worse off than you are now because the authority would simply treat you as if you still owned the house.

Keep_pedalling

I have a freind who looked after his mother for what turned to be 18 years, it seriously mucked up his life and health, and his wife could not stand it after 10 of those years, so moved out (she moved back in after the old lady died)

I will never, ever burden my children with such a task, and will maintain sufficient assets (especially the house) to make sure I can afford care if it is ever needed.