Name change on Deeds from parent to child

Salter321

My 78 yr old Mother has been talking about her house and her general affairs recently and has told me today that she has made an appointment at the bank where her title deeds are held (house mortgage free) in order to change them over to my name.

She's of completely sound mind and health and I'm struggling to get the reason out of her why she wants to action this now as the house will be mine after she passes anyway. But she's a determined woman!

The best she has come up with(!) is that it may help my husband and I buy our own house. She thinks we're 'getting on a bit' (we're 42!) and that we should be looking to buy a house sooner rather than later. We've rented for 15 yrs and whilst we would love to buy a house, the reality is getting that deposit together will take a good few years yet!

We just accepted that we'd be renting for the foreseeable and actually, it does have it's benefits in that we don't get maintenance bills!

I'm rather close to my mum but have only had passing conversations with her about what our house plans are for the future and I would certainly never ask her for any help with deposits etc even though I know she would help us if we asked and she could. I'm a little bit proud I suppose!

If she had a good amount of cash, I'm pretty sure she would have gifted us some money by now as she is of the generation that everyone should own a house. But she is more property rich and cash poor.

So my question is, if she was to go ahead and change the title deeds to myself, how would this affect me getting a mortgage in the future? I've never owned a property so would I be entitled to still get a first time buyer mortgage? Would me owning a house have an effect on what kind of mortgage and deposit I would need and could I use the house as a deposit of some kind?

Mum's house is worth around £250k and if we were to look into buying , we would probably be looking around the £200k mark.

I don't want her to think I'm being ungrateful and I know her intentions are genuine so I have said to her before she goes ahead with changing anything we really should get some professional advice cos it could turn out she does this and it actually doesn't help us at all i.e we may have to pay stamp duty as I would already own a house

Anyone have any experience of this?

Tom99

You would have to pay +3% stamp duty if you buy your on place and you will not be a 1st time buyer.
You will have to pay CGT on any uplift in the value of £250k when you eventually come to sell the house.
If your mother need to go into a care home and does not have a lot of cash the Council will probably treat this gift as deliberate deprivation of assets and will not pay for her care.
If your mother does not have much cash then she is well within the £500k IHT allowance she will have from next April so no saving in IHT.
If you divorce then you will probably have to give some of this asset to your then ex-husband.

I cannot think of any benefit you will get by doing this.

G_M

* you will lose your first time buyer status and no longer be eligible for various related benefits.
* if you bought a property of your own, you'd be liable for the additional 3% 2nd property SDLT
* if her intention relates to inheritance tax avoidance(legal), it would not work assuming she remains living in the property- it would be a 'gift with reservation' (google it).
* similarly, if the intention is to reduce her assets so as to be eligible for local authority care costs (if/when needed), again this is unlikely to work. See 'deprivation of assets'
* there are also mutiple reasons why this makes her vulnerable. If you were to divorce, go bankrupt, have some other life crisis, 'your' property in which I assume she'd still be living, could become at risk

You/she need to clarify why she wants to do this, and then consider whether it actually achieves the desired aims, and also consider all the implications to you both.

The actual process itself is easy if the property is registered at the Land Registry (is it?). See
https://www.gov.uk/government/publications/registered-titles-whole-transfer-tr1

If the property is unregistered, then 1st registration will be required. See
https://www.gov.uk/government/publications/first-registrations/practice-guide-1-first-registrations


But there are bigger issues here.

TBagpuss

If your name is on the deeds of her house, you won't be classed as a first time buyer as I think it is defined as never having owned a property before. You would also need to pay higher rates of stamp duty as any property you bought would be classed as a second home.
It could also create a lot of issues in a worst case scenario if you and your husband were to split up, or get into significant debt, as that could result in your mum losing her home.

There would also be issues of deprivation of assets if she were to need care in the future.

I suspect that it would actually make it more expensive for you to buy . I can't see that it would make it easier, unless you were to sell her house once it was in your name, which I assume from what you've written isn't something she would want, or you would do!

Salter321

I did explain to her about the care home element and deprivation of assets but in truth, I think she just wants to do it now as in recent years she knows of people that have passed on and then their families have had to go through probate, which has been a lengthy process for some. So whilst I think the main reason for wanting to do it is to help us in some way buy a property, she will also be thinking that if we get everything in order now, it will be one less thing for me to worry about when she passes on

I shall invite her over for a sherry later and tell her I don't want her house! ;0)

Keep_pedalling

Probate is not difficult, and to be honest it is a dumb reason to do it. Put you foot down and tell her that you you do not want to do this.

Flugelhorn

Keep_pedalling wrote: »

Probate is not difficult, and to be honest it is a dumb reason to do it. Put you foot down and tell her that you you do not want to do this.

Agreed, probate with small straightforward family is fairly easy - not a good reason to change the deeds now

AdrianC

Even ignoring any extra costs from the additional property SDLT and loss of FTB benefits, you owning her home and being her landlord is not going to make buying a property for your own home any easier...

Not unless you evict her and sell her place, of course, and use the equity towards your home.

And I don't think that's what she has in mind, is it?

FreeBear

G_M wrote: »

If the property is unregistered, then 1st registration will be required. See
https://www.gov.uk/government/publications/first-registrations/practice-guide-1-first-registrations

If indeed, the property is unregistered, it would be well worth doing a voluntary first registration now. Doing it after she has passed away is quite a bit more expensive and a minefield if the executors can not provide all the necessary documentation. Should the property be registered now, transferring after death is a pretty simple & inexpensive process.

Changing the ownership now would trigger a compulsory first registration which would be the only plus side. All the negatives issues already mentioned would still stand.

Mojisola

Salter321 wrote: »

My 78 yr old Mother has been talking about her house and her general affairs recently and has told me today that she has made an appointment at the bank where her title deeds are held (house mortgage free) in order to change them over to my name.

FreeBear wrote: »

Changing the ownership now would trigger a compulsory first registration which would be the only plus side.

All the negatives issues already mentioned would still stand.

As everyone has said - it's a bonkers idea and will cost you money instead of helping you.

She probably doesn't realise that she will have to register the property with the Land Registry before any change of ownership can happen. This will delay things and give you a chance to explain that her idea will cause you problems rather than help you.

GDB2222

Salter321 wrote: »

I did explain to her about the care home element and deprivation of assets but in truth, I think she just wants to do it now as in recent years she knows of people that have passed on and then their families have had to go through probate, which has been a lengthy process for some. So whilst I think the main reason for wanting to do it is to help us in some way buy a property, she will also be thinking that if we get everything in order now, it will be one less thing for me to worry about when she passes on

I shall invite her over for a sherry later and tell her I don't want her house! ;0)

I often have qualms about the advice people give here, but I think you've only had really excellent advice on this! As you say, explain to mum how grateful you are for her kindness, but it's a really bad idea for all sorts of reasons she has not thought of.

If she does want to help you, particularly with probate, she should:
a) Get hr will looked over and updated if necessary.
b) Register the house on Land Registry - this really will help you tremendously after she's died.
c) Make a list of her assets and where everything is.
d) Make a power of attorney, so you can deal with things for her if she gets to the stage where she is unable to do so. (You can do this yourself - you don't need a solicitor).

She should also consider making an advance statement of her wishes concerning treatment. It's not binding, but it may help the situation. This is one I wrote for myself before I had a major operation, recently. It's not perfect, but it's simple, and better than nothing (I thought!).

Advance statement of XXX



This is not legally binding, but those making a ‘best interests’ decision on my behalf should take its contents into account.

My fundamental beliefs are that a person should be allowed to die with grace and dignity, and that a life should not be prolonged with aggressive medical treatment where the resulting quality of life is poor and where there is no reasonable expectation of recovery.


If my condition is determined to be terminal and with no hope of recovery, I do NOT want to be kept alive by artificial life support, I do not want tube feeding if it would cause me to suffer undue pain or discomfort, and I only want CPR if there is a reasonable expectation of full recovery from whatever caused my heart to stop. The same applies in the case of persistent unconsciousness, or if I am severely and permanently mentally impaired.

In any of the above circumstances, I want the following drugs administered even if they will worsen my physical condition or shorten my life: Behaviour controlling drugs (for violence), and Pain controlling drugs.
.


Just type it out, and sign and date it. It doesn't need witnessing. I also updated my will and did POAs.