Transfer deeds or sell property from parents

jacksmummy2012

steampowered wrote: »

It's legal, but I don't think you would be able to get a mortgage in these circumstances.

You can only get a standard mortgage if you are living in the property.

You can only get a buy-to-let mortgage if you are letting the property to an independent third party with rent expected to cover 125% of the mortgage cost.

Another option might be remortgage on your current property to increase your mortgage by £50k. You could then either gift the £50k to your parents or loan it to them.

Great points covered!

Wouldn't want to add another £50k to my mortgage as my siblings will not be equally liable to pay it back. We should all take some responsibility...

jacksmummy2012

xylophone wrote: »

This shouldn't be at the expense of enjoying their own retirement.

Had they explored the possibility of a mortgage?

£50,000 is relatively modest and rates are very low at the moment.

Example

https://familybuildingsociety.co.uk/Mortgages/mortgages-for-over-70s.aspx

Agreed!! It shouldn't be....

Thank you for the link. Will definitely look into this option

jacksmummy2012

Sea_Shell wrote: »

I'm not sure I'd remortgage my property for an extra £50k so my parents can go on holiday, or buy a car...but that's just me!!

Especially as the other 2 siblings are only renters. The homeowning one would be taking all the risk!!

This whole idea screams "law of unintended consequences" to me.

So many ways that this could go wrong and lead to family fallouts down the line.

However, does it have to be a lump sum? Can you agree with your siblings to give your parents a monthly allowance out of your disposable income. They can then save this up for their holidays, car etc. like most people have to.

Exactly what we are trying to avoid.... A big family bust up later down the line.
Nor do I want to bear all of the responsibility with remortgaging my house.
I'll share your points, all things to consider. They want a new more eco friendly car and a holiday this year so perhaps we can filter this out with some cash and maybe a loan

jacksmummy2012

MovingForwards wrote: »

Your parents could speak with a mortgage broker to see what mortgage is possible on their pension incomes.

The kids could kindly pay the mortgage each month.

If the two kids who are renting ever want to buy, and have never purchased a property before, they will be giving up their first time buyer status if they somehow got a mortgage on the parents property.

Again, something else to consider for my siblings

Reading your well informed responses, i doubt we will be selling or transferring the property over as it seems there's so many variables which have consequences with very little benefit for what we are trying to achieve.

kuratowski

Here's a curveball question for the OP, have you checked your own pension arrangements? The reason your parents need to ask their children for money is that their pension savings aren't sufficient to support the lifestyle they want. Think it through. Are you saving enough to provide for your own income in retirement? Do you want to be reliant upon your children, when the day comes?

Sea_Shell

kuratowski wrote: »

Here's a curveball question for the OP, have you checked your own pension arrangements? The reason your parents need to ask their children for money is that their pension savings aren't sufficient to support the lifestyle they want. Think it through. Are you saving enough to provide for your own income in retirement? Do you want to be reliant upon your children, when the day comes?

Extremely valid point!!

Especially in respect of the siblings who are renting, as they may not have a house to fall back on, and downsize from, in retirement.

Can they really afford to be subsidising their parents.

It could put their own future plans at risk.

Don't rely on inheriting 1/3 of the £400k house either. No one knows what the future holds.

swingaloo

How old are your parents? Is it not better for them to simply downsize or look into equity release.

I cant see the logic in what you are proposing to do. As a parent of grown up children I could never envisage myself letting them take on debt in order to get myself a new car or holiday.

If you mortgage the house and get say £50.000 cash for them then you will pay back more than that over the term, all so they can leave you the money back when they pass away. Bear in mind they may not have the money to repay you if they do need to go into care.

It doesn't make sense. I understand you saying that it will not happen and that they will not go into care but no-one can ever guarantee that. One of my parents had to go into care, we had tried every way to prevent it as we knew it was not what they would have wanted. One of my siblings moved into the house to provide 24 hr care but it was impossible. Sometimes you just cannot manage in the end. If you are successful and manage to transfer the house to you and your siblings how are you going to meet the care home charges should the need arise.

GaleSF63

Meanwhile, while you are deliberating on the rest, if you all save about £50 a month there will be enough money for the holiday towards the end of the year, with no future consequences.