Need some advice. Buying grandparent's house.

DarkInferno

Sorry for the block of text, but here we go:

Right, I'd like to know the feasibility and my options regarding what I could or should do. Not sure if this is in the right area as it sort of covers a few (at least in my head).

I live in my grandparent's house. I took it on several years ago as my grandfather was ill (and has since passed) and my grandmother needs a level of care (which my parents provide).

The house had been empty for a while and was in quite a state of disrepair. I was being forced out of my rented home and my grandfather said I should just have the house.

Skip forwards, I wish to buy the house from my grandmother. I had it valued before I moved in (and started renovation work) and have I have offered this to my grandmother for the house.

My grandmother isn't really interested in the money, and has said that as far as she is concerned I own the house. But I believe would just like the money to be given away in the event of her death I have discussed this with her and she has asked if there is any way I could loan the 'money' from her to pay her for the house, as she isn't really happy with banks taking mortgage interest for 'her' money.

Also I would like to 'own' the house, I have sunk money and work into renovating the house to make it habitable, and I am also currently very aware and anxious that I do not know what would happen if my grandmother should die or require professional care.

So I would like to sort it out.

I guess my questions are:

What would be the best way of going about buying the house;

Can I buy the house for it's valuation with a loan from my grandmother? Ideally set up so I could pay her during her lifetime but payable in full within a reasonable amount of time after her death to allow for me to get a (re?)mortgage, or sell the property?

What other options are there?

Who do I (or my grandmother) need to contact, what services will be required and what sort of fees would be applicable?


So yeah, not sure where I should put this... Mortgages, Buying houses, Wills, Life advice... But I'd be very grateful of any and all help.

Mardle

Look for a solicitor experienced in private mortgages. Your grandmother would in effect be your 'mortgage company'.

gettingtheresometime

I guess your opinions are going to be determined to a large extent as to whether your grandmother will need greater care than your parents can provide.


I don't know for definite but if your grandmother transferred the house into your name and then put a charge upon it for the agreed price then by gifting you the house in the first place I would imagine that inheritance tax may come into play if her estate is large enough, were she to die within 7 years, and also would she be considered to have an asset (ie the charge) if she needed greater nursing care?


What happens when she does die and perhaps you can't get a mortgage ?


Whilst it's a lovely thought it seems to be vastly complicating the situation and full of potential pitfalls so I'd just go for the mortgage route myself

scriv

Yes, I would also advise keeping it simple.

I think there may be complications if your grandmother were to sell the house to you at a below market rate or give it to you or put a charge on it and loan it to you.

There could be implications as regards possible inheritance tax and also in the event that she needs professional care in the future when she would be subject to a financial assessment. I think the house would still be considered an asset in this scenario.

I think you should seek professional advice.

StumpyPumpy

You should consider what would happen if your grandmother needs to go into full time residential care and look up the rules on Deprivation of Assets to see how, if at all, that might affect your grandmother and you.

I am no expert but I believe that you will need to make sure that you pay the full market value at the time of purchase to avoid problems, so you need to get it valued again and not rely on a valuation of several years ago. And, unfortunately, your "renovations" will also have to be factored in. Just because you did them, does not make any increase in value they give void. It is still your grandmother's house, so they are really her renovations not yours. I assume you are not paying any rent to her at the moment so the work that you did could easily be regarded as payment in kind and you can't discount that.

This is not going to be something you can do without getting a solicitor that specialises in this sort of transaction on board. Get some good, professional advice sooner rather than later - it will save you money and trouble in the long run.

SP

trailingspouse

As you are living there anyway (and thus not in need of a roof over your head) and everyone seems happy with the current situation, how would it be if your grandmother left you the house in her will and you just waited, erm, (trying to be delicate here) for nature to take its course.

That way there would be no deprivation of assets - if the house needed to be sold to pay for her care, it could be.

Your grandmother may not be interested in the money, but that doesn't mean it won't be important to her in the long term. Has she appointed a power of attorney (this needs to be done while she is 'of sound mind'), who could make sure her financial decisions are reasonable ones?

G_M

Has she written a will?

What other assets does she have?

Who else in the family might she want to leave things (money, property, possessions) to?

Who in the family might feel hurt if you get the house and they get nothing, or a few nick-nacks?

Do you want family war after she dies?

As for the legal side of things, see posts above.

DarkInferno

Inheritance tax wouldn't be an issue, and other assets are limited/negligible.

She believed her will had specified that the house was mine with the agreed price going back to her 2 children to be shared between them and her grandchildren...when i expressed concern she opened her will and it doesn't mention the house at all...

The reason I want this sorted out is i want to avoid any potential disagreement... although i'm fairly sure everybody concerned knows the agreement I'd like it formalised just incase.

Would my grandmother re-writing her will leaving me the house minus the agreed price stipulating that the money should be raised (within a sensible timescale) to be shared etc.. be a sensible/feasible idea?

gycraig_2

Not an expert so may be wide of the mark. Could she leave it you in the will with a clause you pay the others a set amount.

When she dies you remortgage the house to pay the others ?