Buying flat from deceased estate

seven-day-weekend

If I wanted to buy a property from a deceased estate, but the estate is shared equally between me and two charities, how would that work?

(For example : The property is worth 50k,has a mortgage of £20k. It's a flat with a very short lease (50-ish years). I'm the executor).

The owner is still very much alive at the moment and living in the property and I hope she remains so, just having thoughts for the future.

Tom99

[FONT=Verdana, sans-serif]I guess you will have to proceed with caution, particularly your role of executor v beneficiary.[/FONT]
[FONT=Verdana, sans-serif]You will need an RICS Valuation of the property for probate and it may be that the charities agreed to accept a cash equivalent of that valuation.[/FONT]
[FONT=Verdana, sans-serif]The current owner should consider extending the lease if they qualify. I am not sure if an estate can do that after death, I think you can and the charities might want a figure based on the extended lease.
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theartfullodger

Not a lot of point speculating what/how/if yet. The law on probate, CGT, IHT, conveyancing, stamp duty etc etc etc could (well, it will won't it..) change between now & when the individual concerned throws off this mortal coil, so whatever plan you come up with now will require change.

And anyway she might find a new male friend ( or female) and leave everything to them: Or decide to give everything to some other worthy cause, cutting you & the current 2 charities out.

Get on with your life, enjoy it, do good if you get a chance: no offence but you might drop dead/get hit by a 'bus first... Trust you have a will & it benefits some charity?

Cheers all!

seven-day-weekend

Yes we know we have to base things on the market value and would not dream of doing anything else, although we thought the value may be with the short lease as the owner can't afford to renew it (the only reason she has a mortgage is to cover some money for major works).

We thought we could just have it valued at market value (with the short lease) and then if the figures were acceptable, give the charities their third each. (The beneficiaries are two charities and myself and my husband. 1/3 each). Is this not possible?

Oh well if it is not possible, we'll just have our third. Not a problem!

seven-day-weekend

theartfullodger wrote: »

Not a lot of point speculating what/how/if yet. The law on probate, CGT, IHT, conveyancing, stamp duty etc etc etc could (well, it will won't it..) change between now & when the individual concerned throws off this mortal coil, so whatever plan you come up with now will require change.

And anyway she might find a new male friend ( or female) and leave everything to them: Or decide to give everything to some other worthy cause, cutting you & the current 2 charities out.

Get on with your life, enjoy it, do good if you get a chance: no offence but you might drop dead/get hit by a 'bus first... Trust you have a will & it benefits some charity?

Cheers all!

Yes we both have wills and there is a charity benefitting from each of them.

I am well aware that things could change but there is no harm in planning for the future, surely? It things change, then they change and we won't be able to do it. All we are doing is working on the current set up.

getmore4less

It is fairly straight forward people do it all the time.

There is the self dealing issue(easy to sort out)
Getting the two charity beneficiaries to agree the price may be the stumbling block.

You getting a mortgage with a short lease may be another hurdle this would need the cash to buy out the others and pay off the current mortgage.

seven-day-weekend

getmore4less wrote: »

It is fairly straight forward people do it all the time.

There is the self dealing issue(easy to sort out)
Getting the two charity beneficiaries to agree the price may be the stumbling block.

You getting a mortgage with a short lease may be another hurdle this would need the cash to buy out the others and pay off the current mortgage.

We won't need a mortgage.

getmore4less

seven-day-weekend wrote: »

We won't need a mortgage.

It will be just getting the charities to agree a distribution.

What's the plan for the place,

Would the relative be interested in a deal now?

Norman_Castle

seven-day-weekend wrote: »

We thought we could just have it valued at market value (with the short lease) and then if the figures were acceptable, give the charities their third each. (The beneficiaries are two charities and myself and my husband. 1/3 each). Is this not possible?

You can sell the property at its market rate with you as the buyer then distribute the assets to the beneficiaries.
As the executor of the will and the buyer of the property you have to be able to demonstrate you paid a fair price for the the property.

AnotherJoe

The issue with charities is that they tend to be extreme in getting the last penny out, (TBF even if just thats because that's their legal duty) and that can cause problems to executors and recipients.

Unless the will is worded unusually you will almost certainly have to advertise on the open market and then "gazump" that bid, I doubt for example the charities will just accept valuations from EA's and then allow the purchase from you to proceed that way.

seven-day-weekend

getmore4less wrote: »

It will be just getting the charities to agree a distribution.

What's the plan for the place,

Would the relative be interested in a deal now?

She might be. However I was worried about the Deprivation of Assets rule if she ever has to go into care. She is 82 and has no major health problems at the moment.