Buying out siblings share

goldenicon

My mother is leaving 50% of her house to me and 50% to my sibling in her will.

I currently reside in the house and my sister has a home with a mortgage that she lives on with her partner.

I want to buy my siblings share of the house which going by recent sales in the same street would be @£100,000 so I would need to give her £50,000 bearing in mind that properties can go up and down.

We have both agreed that I can pay her a monthly fee of between £400-500 for 10 years subject to house price.

Will I need a solicitor for this or could we both just draw up an agreement.

What would the ramifications of this be in regards to tax etc?

Thank you.

Pricivius

I'm confused - you're buying something that your sister doesn't own yet, and may never own?

goldenicon

No, neither of us own the house as our 90-year-old mother is still happily with us and hopefully will be for many more years to come.

I am asking for future reference for when the time comes when we both will own an equal share of the property.

greatcrested

Has you mother other assets? Of what value? Enough for you to inherit the house and your sister to take the savings/investments?

Does your mother's will speciically specify that the house is to be inherited jointly (bad idea!) or that her Estate is to be shared?

Putting that aside, no reason you cannot do as you plan, but note

* the Executers of the will should not put the property into your joint names - he/she/they should transfer the property into your sole name. Assuming there is no mortgage or equity release involved, it's easy to do

* the executers will, of course, get the property valued at the time, for potential inheritance tax purposes. You would owe your sister 50% of that value

* for your sister's sake, a Deed would be sensible to document her loan to you

* she should also place a Charge on the property, to be removed either when the loan is paid off or if/when you sell - just like a mortgage. That protects her in case you go bankrupt, get divorced, die, or just fall out and try to rip her off..... I'd recommend a solicitor to draw this up.