How to protect money invested in our daughters new house - in her husbands name

Mojisola

Cnort1 wrote: »

Our Daughter and new Son in Law currently live in a house owned by us.

She is now married with a child and they want to move home, we have agreed to sell the original house and for them to use the equity (£145k) as a payment towards the new home. He is working and has a mortgage offer.

She is a stay at home mum and so cannot go on the mortgage as the lender (Halifax) will then lower the amount which means they can’t afford the house.

Clearly he can then sell the house, disappear with the money, or claim he hasn’t got it, or worse and we have to chase him through the courts to get it.

While it would be better to find another lender who will allow your daughter to be on the deeds, a spouse can register Matrimonial Home Rights with the Land Registry which means the registered proprietor can't sell or mortgage the property unless written consent has been received from the spouse - it puts a charge on the property in the same way that a loan does.

AnotherJoe

foxy-stoat wrote: »

You need to loan your daughter the £145K with an agreement and second charge on the property to fully protect the money - not sure if a lender will agree to this where the whole deposit is a loan.

They did in my daughters case. Indeed she got an excellent mortgage rate at it was at 50% LTV.

getmore4less

Another option could be one of the offset arrangements where the money is just on deposit and stays in your ownership.

tlc678910

Hi,
If you can loan the money and put a charge on the house using another lender (as suggested above) I would go with that because in the event the couple divorce you will be able to keep all of this money in your family rather than it being split possibly in half as a marital asset. It is a lot of money to leave to chance.
Tlc

malc_b

I'm confused as to why you don't gift the money just to your daughter (with a deed of gift if you want to be really formal). She would then be contributing £145k to the house purchase and would naturally need to be a joint owner of the house. Should you daughter and partner separate then she could point to paying it 145k to the house as proof of her share when the joint assets are divided. Yes, it maybe that she gets less than the 145k back as her husband has an argument that he has been keeping her. However she is at home looking after his child and he will be expected to contribute to the upkeep of the child.


There is an advantage that by giving away 145k now you are potentially reducing any death duties. If you jointly own more than 900k (including your home) then 145k would incur 58k tax. Or of course if you need care then all of the money could go, and I assume the 145k as well if it is legally still yours. Maybe you going into care could result in your daughter losing her house?

scd3scd4

I am the only child. My dad is dead and my mum getting on. You owns a house of about 300k plus and has saving, shares and the rest. My wife and I are partners............I never understood all this. My wife was made redundant a while back and got about 25k.............the first thing she did was "say lets go for a meal and think about what we should do!"




Its all strange to me........

YoungDumbNBroke

As suggested above, there would be no issue with having your daughter on the mortgage. I am no expert but myself and my partner have uneven shares in our property, I know it's different for married couples as far as the mortgage goes (Joint mortgage vs Tenancy in common), but we have a Declaration of Trust set up to protect our initial investments, and any profit is split 50/50. Seems fair to me however I would recommend speaking to a qualified solicitor.

Sorry it's not too helpful!

ViolaLass

My husband was on our first mortgage with an official income of 0 (because we couldn't be bothered to jump through hoops to prove his self-employed income). It didn't affect the amount we could borrow.

That was with Nationwide.

Cnort1

Thank you all for your really appreciated comments.
I'm afraid Halifax seem to be the issue as you have highlighted.
Not allowing a deed of trust.
Not allowed to put my daughters name on the deeds as not on mortgage. Therefore negates any affect of giving her the money as she has to then give it to him.
She's not on mortgage as reduces the amount they can borrow (how odd as she is bringing the cash and is still named as living there on the sole name mortgage application).
We ahve gone back to Halifax and basically said they either allow something or we will go to lenders some of you have mentioned.
Thank you again!

malc_b

I think I would complain to Halifax and go elsewhere. This is like going back a hundred years when women could not own property, it all had to be in the husband's name.


Moneyfacts.co.uk have a best mortgage deal calculator or try a broker. Some brokers still work on just getting the commission from the bank so it need not cost any more than going direct, and if you have already checked out the deals on moneyfacts you have a good idea of what is a good deal. You might even save money over the Halifax deal as when I looked recently Halifax didn't appear anywhere near the top of the list (for my son anyway).