Buying house after probate

Suz1949

My father is 97 and in very poor health. I am his executor and his estate will be divided between myself and two siblings. After probate I intend to buy the house. I have a house that I live in to sell before I can buy my father`s house. My questions are, how do I arrange to buy my siblings share of the house and is it as complicated as buying another house?

kinger101

Are your siblings aware of your intentions?
Is there likely to be any IHT due on the estate?
Will the house need to be sold to cover this IHT?
Who will act as executor/administrator of the estate?

AdrianC

Let's say his estate is worth £375k, of which £300k is the property, and £75k of other assets.
Each beneficiary is due £125k.

You put (£300k-125k=)£175k into the estate, and the property is transferred to your name.
That leaves the estate with £250k to distribute to the other two beneficiaries.

How you raise that £175k is a question for you, not for the estate.

Tom99

Providing you can agree a price with your siblings and they are happy to wait whilst you sell your existing house then the process should be straightforward.

JGB1955

You may need to get a RICS valuation of the property to assure HMRC that you are paying the market value of the house.

Suz1949

Thanks for the replies. The value of the estate would probably be £170,000 maximum and my brothers are happy for me to buy them out. I'm the sole executor and thought that, with their agreement, I would get valuations from three EAs and take the average price. I wondered if it would be as costly to buy them out as it is to actually buy a house the usual way.

DigForVictory

Safest is to get a RICS valuation rather than any number of estate agents.

That way HMRC are satisfied, you have a solid figure for capital gains & your siblings & you can get a heads up on anything your father has not had the energy to get around to sorting,

It is never easy to love someone you love, but the legalities can be danced around if you know the steps.

Suz1949

Will look into a valuation from RICS, but the other aspect is how to transfer ownership after buying out my brothers. Sorry to seem slow but I've only ever bought one house and that was 44 years ago!

AnotherJoe

Suz1949 wrote: »

Thanks for the replies. The value of the estate would probably be £170,000 maximum and my brothers are happy for me to buy them out. I'm the sole executor and thought that, with their agreement, I would get valuations from three EAs and take the average price. I wondered if it would be as costly to buy them out as it is to actually buy a house the usual way.

If theres a mortgage involved it will be. If not, it wont.

Owain_Moneysaver

You really should get a RICS valuation to avoid any future dispute over value. Estate agents often over-value a house in the hope of getting a sale instruction, and this may bite you twice - you will 'pay' more for the house, and may have higher than expected repair bills if work needs to be done. A RICS valuation will give you a fair valuation of the house taking into account condition.

You will probably have to engage separate solicitors to represent you and the estate for the conveyance; as there are other beneficiaries the work may be regarded as contentious and the same solicitor unable to represent both.

The estate's solicitor bill comes out of the estate funds before distribution -- make sure your siblings are in agreement to that as they may not expect there to be costs that affect their inheritance -- and you pay your own solicitor.

Obviously there will be no estate agent or survey fees to pay (unless required by your mortgage company).

When the time comes, as executor is is your responsibility to keep the house secure and insured. Also, if the property title isn't registered at the Land Registry, ensure you know where the deeds are kept. They may be in a vault somewhere after a mortgage was paid off thirty years ago.

AdrianC

Suz1949 wrote: »

The value of the estate would probably be £170,000 maximum

HMRC won't care much, then, because you're nowhere near IHT.

and my brothers are happy for me to buy them out. I'm the sole executor and thought that, with their agreement, I would get valuations from three EAs and take the average price.

That's as good as anything.

I wondered if it would be as costly to buy them out as it is to actually buy a house the usual way.

What do you mean by that?

You don't need as much in the way of legals, and obviously there's no EA for you as seller to pay if you sell it to somebody else. But if you want to mortgage it, the lender's going to insist on valuation etc, and on a solicitor to do all the paperwork. If there's no mortgage, then you could do all the transfer paperwork yourself without great difficulty. If it's not yet registered, there's more involved.