buy to let property for my mother with my money

sann420

All,
I have an elderly mother who apart from having tiny little pension is financially dependent on me. I am thinking about buying her a buy to let property worth approx 50k with my savings which she can rent out and get some permanent income from it. I don't want to buy the property on my name because being a salaried person I would have to pay tax on the buy to let income which means less money for my mum.

However if I buy the property on her name then my fear is that if she has to be taken into state care at some point in future then they would consider this property as her asset and take it over to recover their costs. Which I would like to avoid given that it would primarily be my money that buys her this property. 

Is this a legitimate concern?
Any ways to circumvent this ?
- Thanks in Advance.

Mojisola

Loan her the money and put a charge on the house so that the loan gets repaid when the house is sold.

Does your mother really want to be a landlord with all the legal responsibilities?

SDLT_Geek

Which country are you in?

swingaloo2

Thankfully not. It would be a disastrous idea.  Who is going to be the landlord of this property when it is let out?. Is your elderly mother going to be able to cope with being a landlord of a property, which at  50 grand is probably going to need more spent on it a year than the income it generates.

lincroft1710

So you have a financially dependent elderly mother and you want her to become a landlord??? It would be far simpler, easier, less stressful and more sensible just to gift her money as and when she needs it.

Also, I don't know what £50K buys you in your part of the world but it doesn't seem you will be getting a good place, so she could end up with a tenant who is not the best.

sann420

Mojisola said:

Loan her the money and put a charge on the house so that the loan gets repaid when the house is sold.

Does your mother really want to be a landlord with all the legal responsibilities?

I think this might be the most sensible option for us. Thanks

The idea is to buy a small one bedder up North where properties are cheap. I havent done full research if its possible tbh as the idea is still in incubation stage.

We will let it out through an estate agent and obviously I will be the one primarily dealing with any issues... not my mother. although she will legally be the landlord.

AdrianC

If t'were me, and I wanted to give £50k to my mother to help her in her pensioner years, there is no way on this planet that I'd be looking at forcing her to become a landlord - especially of a bottom-end property the other end of the country, dependent on agents...

I'd be looking into annuity rates.

greatcrested

So not a property local to either you or your mother.

Do a full income/expenditure budget and see what it shows. But my guess is that by the time you've factored in maintenance (on a £50K propery...), annual tenancy costs, letting agent fees, tax (not to mention tenant damage, non-payment of rent, voids etc) the income will be negligible and certainly not worth the stress and agro.

Put the money into an income-producing investment which will be far less troublesome, and liquid as well if you ever need access. Then give mum the income from that, topped up with capital as required (which you'd not be able to do with a property).

Post your query on the investments board here.

Mojisola

sann420 said:

I have an elderly mother who apart from having tiny little pension is financially dependent on me.

Is she entitled to Pension Credit?

www.gov.uk/pension-credit/eligibility

Grumpy_chap

I am more pro BTL than many in this forum, but this idea has less merit than withdrawing £50k in cash and your mother burning it to keep warm.

Crashy_Time

LOL, love these wind up threads, the sooner the daft property bubble bursts the better, there probably still are people who think you can`t go wrong with anything connected to B&M, LOL.