Acquiring part of parent's house

tebthereb

I am looking to acquire a percentage of my parent's house from them.

The consideration will be cash; market value. I would be acquiring a percentage of the beneficial interest; they would remain legal owners and hold my percentage on trust. I would be entitled to my percentage of any income or proceeds from sale.

Can this be achieved without incurring professional fees? I believe a declaration of trust would suffice. Would something need to be filed at the land registry?

This is not driven by tax or care home fee avoidance etc. I know there are various potential issues around this but I am asking purely how to convey part of the beneficial interest.

I am sure this will have been covered elsewhere but I cannot find it, sorry.

EDIT: The house is mortgage free. My wife and I would be hoping to acquire around 10% as an investment from my parents.

McKneff

Why..........

tebthereb

Thanks for the quick reply.

Why? Why, what?

Why I am looking to do this? Essentially as an alternative to parents doing equity release with a third party.

Why do I want to know how to convey the equity? So I can do this as cheaply as possible, myself, if possible.

Mojisola

tebthereb wrote: »

Why I am looking to do this? Essentially as an alternative to parents doing equity release with a third party.

It may be easier to make it a loan and for you to put a charge on the house so that your money will be repaid whenever the house is sold.

tebthereb

Thank you. However, to confirm I am not looking to loan them money. At least not without a significant return of interest; this is an investment for me and on sale I would be looking to get back more than I put in - i.e. based on growth in value of property. Possibly a charge could achieve that but it sounds more complicated and I also thought a charge would need to be registered formally.

I am really only looking to establish how I can legally obtain a percentage of the equity.

gettingtheresometime

tebthereb wrote: »

Thank you. However, to confirm I am not looking to loan them money. At least not without a significant return of interest; this is an investment for me and on sale I would be looking to get back more than I put in - i.e. based on growth in value of property. Possibly a charge would achieve that but it sounds more complicated and I also thought a charge would need to be registered formally.

I am really only looking to establish how I can legally obtain a percentage of the equity.

& there was me thinking you were being charitable........


If you become a part owner (which is what you seem to be implying you want to happen) then if I was your mum I would expect you to stump up your share of any maintenance costs.


Also what if you fell out with them and then decided you wanted your share & tried to force a sale?


Not to mention if (and I'm making assumptions here so forgive me!) you split up from your partner then your share of the house would go into the pot - another situation where the sale of the house had to be forced.

Cakeguts

If your parents go into a home the local council may think that you and they have done it on purpose so that they can get some of the care home fees paid. There are rules on this. You should look them up.

TonyMMM

tebthereb wrote: »

I am really only looking to establish how I can legally obtain a percentage of the equity.

You agree a price for a % share of the property and your parents sell that share to you. A solicitor will deal with the relevant paperwork.

It potentially creates all sorts of future issues for you (and them) as already mentioned, but you appear happy with that.

G_M

You compete forms
TR1
AP1
ID1

and submit to th Land regisry such that you become a registered jont owner. This assumes there is no mortgage on the property.

You own as 'Tenants In Common'.

You create a Deed specifying the ownership shares which i recommend is drawn up by a solicitor.

[Deleted User]

Your parents spent hundreds of thousands bringing their kids up without a thought for profiting out of it. Now they are considering equity release. Why not just think, hey they are my parents, its not appropriate to think of making a profit out of them after they brought me up - and shocker, I will GIVE them a few thousand because its a pittance compared to what they spent bringing me up.

Yes this is a money saving site, yes we all try to save or make money to live on.. but there's times when its just not appropriate. Your parents must be in need to be thinking of equity release and you are thinking of making a profit on their situation, no doubt telling yourself you are doing both parties a favour. If they are in need and you can manage it, profit shouldn't come into the equation.

The words profit and parents shouldn't be in the same sentence. Even if they weren't perfect parents. Not everything of value appears on a profit and loss account.

tebthereb

G_M wrote: »

You compete forms
TR1
AP1
ID1

and submit to th Land regisry such that you become a registered jont owner. This assumes there is no mortgage on the property.

You own as 'Tenants In Common'.

You create a Deed specifying the ownership shares which i recommend is drawn up by a solicitor.

Thank you this is very helpful.

Can I just double check I have this right then - you are saying that even though we do not wish to change legal title we still have to file forms with Land Registry?

I have a template deed in hand which I am reasonably happy to deal with myself. I imagine a solicitor will charge a few hundred pounds which i wish to avoid given the amounts concerned. I appreciate it is always best to use a professional.

There is no mortgage.