Buying a house with Granny flat with joint parent and personal income. Implications?

Pixie5740

To be regarded as a gift lenders would expect your mother to sign away any rights to the property for the money to genuinely be gift not money given with the expectation of it buying somewhere for her to live.

Go and see a mortgage broker to find out if what you are proposing is even possible.

Gavin83

gettingtheresometime wrote: »

1. You get divorced - what happens to mum then?

This is probably the second biggest risk to be honest. It's all well and good suggesting that you'll sort something out but if that involves effectively asking your wife to sign away a large sum of money it's unlikely to work out as suggested. She'll be entitled to 50% of the house, potentially more if she was to be the primary carer of your child.

I have to say your mother is extremely trusting and frankly is taking all the risks here. I've seen first hand a number of horror stories doing just what your mother is planning, which has effectively left the elderly person with no assets what so ever, arguably when they most need it.

As for requiring care, that's probably the biggest risk. If she doesn't need care for a number of years then it's unlikely to be a problem. However if in 2 or 3 years she needs to go into a care home then yes, it's extremely likely you'll need to sell the property, unless you can fund what will likely be £500pw separately. The council won't just ignore that.

Also, I'm assuming your wife is happy with this situation? I don't know many people who'd be happy to live with their in law.

mikeholland

My wife actually suggested it, although I said the Granny flat was essential for everyone's sanity, if we did it that way. It may simply be a non-starter. I can't have my child turfed out of their home in case my Mum needs care. I honestly don't know if I'd be able to afford 2k a month on top of everything. Probably not unfortunately. Seems insane that I might not be able to look after Mum, or even maybe live in the same country on the chance she gets ill in future.

trailingspouse

In what way is she not coping on her own?
The death of a spouse is always difficult, and your mother (and you) are going through the grieving process. I think it's a natural reaction to try to help. But - has your mother actually said she isn't coping? Is there evidence that she isn't coping?
An immediate solution in the short term might be to sort something like a cleaner/home help? That would give her a bit of breathing space while she decides what she wants to do.



And re buying a place that includes a granny flat, another scenario (which happened to a relative of my husband's) is that you make the purchase, your mother dies quite soon after moving in, and you are left with a house that is far too big for your needs.

Savvy_Sue

Robin9 wrote: »

What does your mum want ?

It's generally not recommended to make any too radical decisions immediately after bereavement, so it's worth bearing that in mind. ATM she has friends: if she moves elsewhere how easy will she find it to make new ones?

Gavin83 wrote: »

Also, I'm assuming your wife is happy with this situation? I don't know many people who'd be happy to live with their in law.

One of my siblings lives with MIL. Their spouse expressed surprise at the number of people who thought it was 'brave'. I just pointed out that none of us would have wanted to live with OUR mother, and would definitely not have inflicted her on our spouses!

onlyroz

Regarding the house purchase and how it should be managed, you probably want to seek some legal advice to consider all the implications. Probably some sort of tenants in common arrangement with you all owning a proportion of the property and you are all on the mortgage. As for what happens in the case of care homes, death, divorce etc, that's what you need to ask the solicitor.

Have you considered having your mother move into one of those sheltered accommodation blocks, e.g. McCarthy Stone etc? These properties are designed for retired people, have wardens to deal with emergencies and have communal facilities with activities arranged. I know a few people whose elderly parents have moved into such a place after being widowed.

thorsoak

At the moment we (family and I) are mulling over doing something similar.

I'm 75, still pretty fit, and working three days a week. I live on my own, in a large three-bedroomed bungalow with a really large (240ft x 50ft) garden .....when we "downsized" 10 years ago we moved from a 5-bedroomed house with a half acre garden, so this was a downsize - of sorts! Sadly my OH died after just 2 years living here, but I'm pretty settled - its a lovely spot with shops, library, doctors, dentist, cafes pubs and restaurants all within walking distance - and we still have a bus service.

None of my children & families live near me - nearest is 35 miles away - and 2 live abroad - but distance does not mean htat we are not close. Now No 3 son & wife have 8 month old twins and are thinking that they are going to have to move sooner rather than later as their house is bulging at the seams and they would like to move south again to be nearer to both families. So now we are exploring the possibility of them buying my house and building a granny annexe at the end of the garden. We are aware of the pitfalls, and are looking at all of them as well as the benefits. The rest of my family are keen on the idea - and I think it would be wonderful if it happens - I could enjoy helping with grandchildren (though I would not turn into a "granny nanny" and it would be good to know that if and when I need help that they are closer to hand. DiL is very keen too - her parents have built an extension to their house for her grandparents and she sees how it works there.

So, watch this space - until DiL goes back after maternity leave they aren't too certain what mortgage they can get. They know that they have about £40k equity in their present home, so it is feasible. But we have to look at the implications of deprivation of assets/inheritance tax - not to mention planning applications!

I_Love_comps

Private care homes cost far more than £500 a week. More like £1000 +

trailingspouse

With all this talk of granny flats, I think it's appropriate to quote my father at this point.


'Why', he said, 'is it always a granny flat? What happens to the grandads??'

thorsoak

trailingspouse wrote: »

With all this talk of granny flats, I think it's appropriate to quote my father at this point.


'Why', he said, 'is it always a granny flat? What happens to the grandads??'

In my case - cos Granddad popped his clogs :-:cry::A