What to do?? Declaration of Trust, or otherwise.???

TopSound

Hi guys,
Please help me. I'm in a sticky situation relating to my family home and don't know which way to proceed.

I welcome personal and professional opinions of all and hold no liability against any comments or advice provided. I just need honest and educated opinions and note that any decision I take off the back of any comments below I do so wholly at my risk and no liability against MSE nor the users involved.

I'm in dispute with my sibling in relation to the family home and don't know what to do. Very briefly:

• Our mother and father jointly owned a property but got divorced.
• Myself and my sibling stepped in to take over fathers mortgage and are both solely named on deeds; myself, sibling and mother remained living in the property
• Since then, mortgage mainly been paid by mother, despite title deeds and mortgage jointly named in mine and siblings.
• Some small improvement of property carried out, paid for mainly by re-mortgaged equity, and very partially by sibling (but who is claiming to have spent loads more than they have in order to justify benefiting from my entire half).

Within the last year, dispute has occurred between myself and sibling due to the following:

• they are having a baby, and wanted the house transferred without charge or cost to them wholly to them.
• they stated they would take care of mother, but have shown evidence of not necessarily sticking to those terms if they're not appeased.
• the transaction would provide no security to mother if they later decided to sell and kick her out and so I've resisted signing over.
• the mother has said she would have it in her name, but then she could always sign it to my sibling or sell and gift her proceeds to sibling

I've had my life dragged through hell the last year.

I don't want any financial interest, but I want my mothers interest protected; importantly against herself. She's being threatened with exclusion from my siblings family unit in the future, hence I feel she may be guilted into acting against her own interest. If she signs over to my sibling, my suspicion is that she may end up being ousted from her home, and her life made misery. Ultimately I will be the one who picks up the pieces should this happen so I want to remove any possibility of that happening:

I've been told the following by my solicitor:

• If I sign over to her she can do with it what she likes, including potentially martyring herself for my sibling, should my sibling decide to go against her or influence her to change the decision.

• If I sign over to mother she can sign enter a declaration of trust with myself to state that she could not sell her share on or gift it away. Would this need to be agreed to by the other co-owner (my sibling)?
• I had to move out due to the toxicity within the household created by my sibling, and as a result expect this to drag on if I choose the wrong option.

I have 3 ultimate goals here:

• Protect my mothers interest to ensure she doesn't sell her share, then further gift the proceeds to my sibling, nor directly give her rights to anyone else. I feel the need for this to be done for her and not give her the option to give it away in any shape or form. I don't see why my sibling deserves to benefit for 50% of our family home without any cost and free of charge, particularly after the way they have conducted themselves; involving lies, manipulation, excessive tension and drama. They've lied about so many things (including my mother - hence why I want to remove her opportunity to martyr herself).
• Do it simply, so that there are no legal loopholes, or any real possibility for it to be contested later, or for further arguments or drawn out legal drama be conducted either during my mothers life or at her death
• Resolve it in such a way that I'm not burning bridges with my mother and potentially leave the door open for us to have a relationship.

The 3 options I can see are:

• Declaration of Trust - feels like this could work but needs to be exhaustive and literally no loopholes, otherwise these will be exploited. Can this be changed later down the line by my mother solely or by her and sibling? I've read that there are numerous types, and they can be contested later if it's not constructed exhaustively.
• Sign it over and hope for the best and hope that everyone proves good intentions (possible but on balance probably unlikely - indeed even if likely, the small risk it goes wrong is too much)
• Sell the house, buy my mother a property and let her live there without being under pressure. She can still retain a relationship with my sibling as I'll take the blame

In the long run I don't want to have to give away control, have my mother martyr herself and then become financially liable in future for her care incase my sibling reneges on their responsibility of joint care (as I currently consider the case)...

Please advise me as I've spoken to lawyers, and have instructed a lawyer, but am being given advice and being told to choose. Whilst I know I must choose, without their direct advice, I need some impartial advice on which avenue to explore as otherwise I don't fully appreciate all the consequences that might exist later down the line.

Whilst legally it'd be interesting to hear the advice, I'd also be interested in hearing how you personally would manage this, as I don't know which way to go with this. Emotionally I want my mother to have control over her own life, hence sign it over to her, but I know there is a risk she will go against herself, and make my life misery in future by giving into pressure from my sibling.

I just want to move on with my life and draw a line under everything. 
Thanks kindly

pphillips

It's a difficult one, I believe that a declaration of trust would need to be agreed by all the co-owners and is not irrevocable. Perhaps a restrictive covenant between you and your mother would be more effective. Otherwise, it seems to me the best option would be either a sale or the status quo.

Savvy_Sue

If your 3rd plus your mother's 3rd would buy a suitable property then that's what I'd go for, but you might need to go to court to force a sale. would your sibling be able to afford to buy you and mum out? 

However, it's also worth asking what your mother would like to do. Which may be difficult to work out. 

Retireinten

How much equity are we talking about here? If your mum has always paid the mortgage, how's your sister going to afford the mortgage when its fully owned by her...or does she expect mum to keep paying this too? 

I'm not sure why you would gift your sibling half a house for no reason, completely free of charge. What right does she have over the property that you don't (a bit of improvement work does not mean she's entitled to more than the deeds state). You're giving up a good chunk of your own financial security and potentially control over your mother's home in the future if you do this. 

TopSound

pphillips said:

It's a difficult one, I believe that a declaration of trust would need to be agreed by all the co-owners and is not irrevocable. Perhaps a restrictive covenant between you and your mother would be more effective. Otherwise, it seems to me the best option would be either a sale or the status quo.

Ah I suspect if it needs agreement of all parties then it probably won't happen. The method I'm thinking is transfer to mother, she signs her declaration of trust with sibling. Problem is I wouldn't be party to that agreement, nor would I be able to get my own independent lawyer to double check it as I've been told its a conflict of interest.
I've looked into restrictive covenants but it sounds like that applies to the land and not the owners nor the property itself, and itself can also be removed with agreement (i.e. once the convenient is on there my mother and sibling can agree to remove it).
Also, sadly in order to facilitate everyone else's demands here it's going to cost myself, or my mother via her pension - my sibling will not pay at all toward this

Thank you for your reply.

TopSound

Savvy_Sue said:

If your 3rd plus your mother's 3rd would buy a suitable property then that's what I'd go for, but you might need to go to court to force a sale. would your sibling be able to afford to buy you and mum out? 

However, it's also worth asking what your mother would like to do. Which may be difficult to work out. 

Currently, my sibling and myself own the property 50/50. I suspect if selling became a serious option my sibling would probably take it. However they would not entertain buying me out as they consider the property rightfully theirs. 
On what mother wants to do... Well... This is where it gets interesting. She herself has spent the best part of a year being effectively mentally manipulated by sibling, and has tried to faciliate the transfer into sibling and siblings partners name (I suspect partner hugely involved in this), at threats of any future grandchildren may be withheld. As a result mother has tried to appease them, by pressuring me to transfer it over to them. There have been lies from mother to say that mortgage was unobtainable, was running out imminently (turns out theres still 6 months left on the offer).

Only after resisting has the mortgage now been talked about for sibling plus mother. To date it has been sibling, and siblings partner.

As such, I don't feel she can be trusted to make decisions for her own good frankly, and if she subsequently signs over to sibling and partner, she leaves herself without any financial security and at the whims of sibling and partner. If they don't get on (and there is already evidence of huge rifts) I wouldn't put it beyond sibling and partner to expect mother to go on her way and sort herself out without any financial assistance (or minimal if there was) due to the fact they will have child/children, and need to be looking out for their new family unit.

Thank you for your help and response.

TopSound

Retireinten said:

How much equity are we talking about here? If your mum has always paid the mortgage, how's your sister going to afford the mortgage when its fully owned by her...or does she expect mum to keep paying this too? 

I'm not sure why you would gift your sibling half a house for no reason, completely free of charge. What right does she have over the property that you don't (a bit of improvement work does not mean she's entitled to more than the deeds state). You're giving up a good chunk of your own financial security and potentially control over your mother's home in the future if you do this. 

The house is valued in the region of £500 to £550k, with mortgage outstanding of roughly £150k; so a substantial amount! It's unsurprising sibling is miffed at being close to receiving all the equity for free and is now facing barriers to that.

The mortgage payments have been made by mother, but sibling and partner are saying in exchange for the equity they will happily pay the mortgage (no ****!).

My own financial security is not a concern as I and my partner want whatever we have to be built off our own back - we don't want to profiteer from other peoples hard work. 
As far as I'm concerned our mother worked her life and paid the mortgage, and she wants to keep the house and live in it stress free, but I fear what will happen if I give away my control, what mother will subsequently do, and what sibling and partner are capable of in future.

Thank you for replying.

Aranyani

I don't understand why you would change anything?

TopSound

Aranyani said:

I don't understand why you would change anything?

I've spent the last year and a half almost being pressured into signing it across free of charge, with all sorts of lies and manipulation created by all parties - mother, sibling, siblings partner. They've done it such that my life was made a living hell to the point I had to leave home (I used to live there) and move out because I was getting close to emotional breakdown and I had to look out for my own mental health.

They're still pressuring me (including mother) to sign it over - I feel because she again wants to appease the sibling (who in this instance would retain their 50% share). I would then lose any say to stop mother being taken advantage of (there was talk of her leaving her job and becoming their full time nanny!!)

Beggars belief I'm in this situation but hey thats life - from here the pressure isn't going to subside, but the fear she gets mistreated is still pretty strong. I could have the attitude if she really wants to let herself get taken advantage of (she assures me she wont, but she has contradicted herself and flip flopped on decisions so much it's actually a joke), but I know that in the event she does end up there she'll look to me for support in her older age, but at that point it's not really my responsibility.

I could hope and pray I transfer it over, she doesn't do anything further after that, and sibling does in fact take care of her properly, but I don't believe they will look out for her interest as a priority if there's more in it for them.

The question is, given that - something needs to be done with this property and this family tension to resolve it.

Thank you for replying.

getmore4less

• Our mother and father jointly owned a property but got divorced.
• Myself and my sibling stepped in to take over fathers mortgage and are both solely named on deeds; myself, sibling and mother remained living in the property

Why was mother excluded from ownership when she already was part owner also seems she ended up paying most of the mortgage anyway.

How big was the mortgage at the  time you and sibling took a ut the joint mortgage and took over ownership?
How much was the place worth then?

The starting point is work out the beneficial interests in the property, being on the deeds is legal ownership.

TopSound

getmore4less said:

• Our mother and father jointly owned a property but got divorced.
• Myself and my sibling stepped in to take over fathers mortgage and are both solely named on deeds; myself, sibling and mother remained living in the property

Why was mother excluded from ownership when she already was part owner also seems she ended up paying most of the mortgage anyway.

How big was the mortgage at the  time you and sibling took a ut the joint mortgage and took over ownership?
How much was the place worth then?

The starting point is work out the beneficial interests in the property, being on the deeds is legal ownership.

So I was a lot younger then and I wasn't party to all of the conversations had between mother, her solicitor, mortgage broker, and sibling, but I believe it was due to her being unable to obtain mortgage for fathers half, so she gifted it to both myself and sibling to take over. She seemingly is now able (despite lying to me that she wasn't, hence it was to go to sibling and partner!), but the rest of the family tensions have made it such that perhaps her having the mortgage and deeds ownership (with which she can do whatever she wishes) isn't so sensible.

Value was roughly £200k four years ago when divorce happened etc and equity at that point wasn't majorly huge, c. £100k. Problem is I wasn't given access to a lot of this information (well I was) but I was rushed through the transfers and just expected to stand by it. Now I've grown up a bit and realised that these things are well, actually quite serious, I feel a bit more of a responsibility to manage this properly, once and for all, so we're not sitting here in x number of years re-hashing the same problems and arguments.

Thank you for your reply.