Paying out relatives - should I keep it or sell it?

Dig_for_victory_1

I have been left a property by my mother who recently died. The total value of the property for probate is £340,000. I already owned a 50% share of the property prior to her death(she owned the other half). In the will it has been specified that £120,000 be paid out to another sibling (my mother wanted the house to remain in the family if possible for my wife and I to retire to in a few years).
In order to pay out this sum, a mortgage will need to be raised either buy-to- let on the house I am inheriting or through re-mortgaging my own place - there are tenants in situ at the moment paying £1300 pcm...
Should I go down the route of paying out my sibling or just sell the property pay my sibling from the proceeds
Thanks in advance:undecided:undecided:undecided

silvercar

Depends whether you really do want to live in it at some point, whether you see any potential for capital growth, whether you want the rental income....

Linton

What did the will say? Did it give half the house to you and £120K to sibling? In which case would there appear to be insufficient money in the estate to meet the terms of the will?

PS: Is this relevent? https://www.gov.uk/hmrc-internal-manuals/inheritance-tax-manual/ihtm12086

Dig_for_victory_1

My mother suggested prior to her death that I take out a mortgage on her property (of which I already own a 50% share ) to pay off my sibling. I agreed to this; she did not want to leave a percentage share in the house to my sibling as she wanted the house to be in my own sole ownership... but she did want to leave some money to my sibling ... the house is the main asset- there is a small amount of cash... thank you for replying ��

Dig_for_victory_1

The will stipulates that 120,000 should be paid to my sibling but that the house is inherited solely by me. So yes, on the face of it there is insufficient funds to carry out the wishes of the will unless I pay off my sibling...

Linton

See the update to my previous post. The lawyers will correct me if I am wrong but to me it seems that you get the house and sibling doesnt get £120K.

Dig_for_victory_1

Oh gosh... thank you for your link by the looks of things that is correct... my mothers cash assets come nowhere near the total needed to pay my sibling off in cash from the estate...

Manxman_in_exile

I appreciate that this is not entirely helpful to the OP (or it may be helpful depending on the circumstances) but it seems to me that the testator made a mistake in making a specific bequest of cash she didn't have.

getmore4less

Check carefully the order of the will and the rules on abatement etc.

On the house the current rental is gross yield around 4%

As a business is this viable?
Are you looking at mounting costs?
Longer term do you want to keep the place.

Do you have any choice short term?
that will depend on the tenancy.

Yorkshireman99

Dig_for_victory_1 wrote: »

Oh gosh... thank you for your link by the looks of things that is correct... my mothers cash assets come nowhere near the total needed to pay my sibling off in cash from the estate...

Without seeing the exact wording nobody can be sure. Who is the executor? They are the ones who need legal advice on what to do.

Dig_for_victory_1

My cousin is the executor; I have had a close look at the will. The cash money is written for my sibling in her name and in specific terms of the amount of money the next paragraph states that the residual amount in my mothers estate including monies and real estate is mine...