Possible dispute over jointly inherited house

Brynsam

DepositSaver said:

The Deed of Variation suggested does fell perhaps the sensible, lease hassle thing to do, but I have a nagging thought that I know my dad would be really upset if he knew the estate ended up being split so unevenly. 

  

People often proceed on the basis of how someone might feel - but remember that the dead have no feelings; only the living.

Even if you decline your share of the house, and your brother inherits the whole property, what is that actually going to solve except placating him for the immediate future if he's going to come running to you for cash?

If you accept your half but he continues to live there, do remember that if there comes a time when the house is sold, you'll be liable for Capital Gains Tax on 50% of any increase in value between the date of your father's death and the date of sale, on the basis it isn't your only or main resident. Even if at some future point you give him the house, the same would apply - HMRC will base your 'gain' on 50% of what they deem to be the market value.

Let the executor sort it out with the aid of a solicitor, and just stay out of your brother's way.

DepositSaver

getmore4less said:

You need to check but I don't think you can force someone to take legal ownership of property they don't want.
The executors effectively become the legal owners while it is in administration there is a default trust and they are the the trustees.


The problem is selling from under him while in occupation
as he lived there and was effectively depended on that accommodation and indirectly funded by you dad he could try a claim.

If in the end you back down and let him live there, a life interest trust has the effect of making him the beneficial owner for the period of the trust(eg till he sells or dies)  and not you so there is no CGT liability on you or your estate.
you can also have all the maintenance put on him and a requirement to maintain but that is just another problem when it comes to enforcement and forfeiting the occupation. 

If your dad wanted him to live there  he could have put it in the will.

Getting a solicitor involved won't be cheap but does introduce an impartial party.

Thank you for this information, it's useful to know.

DepositSaver

Keep_pedalling said:

It sounds like your brother does not have the necessary income to maintain the house so it would be madness for him to take it on. Older family homes can be a big money pit, and I have seen in my own street how derelict they can become with someone living there and spending nothing on maintenance.

I agree, but I don't think he has thought that far ahead. I think he is focusing on the immediate issue of if the house is sold where will he live. He would have money to be able to buy somewhere smaller and in better condition, and I have suggested that he have a larger share of the proceeds to allow this, but he is adamant he wants to live in the house, not buy somewhere else. He said he "doesn't know how to buy a house". 

xylophone

 He said he "doesn't know how to buy a house". 

Tell him that you do?

DepositSaver

I sent my brother some suggestions for what could be done earlier, including that he have all the house and I have the cash, that we own the house 50/50 but he is responsible for all the upkeep and maintenance, or that we sell and he get more of the proceeds. His response was to ask if we own the house 50 / 50 and he were responsible for all the upkeep, would the cash also be split 50 / 50. That feels like the worst option for me as I would in benefit from a small amount of cash, he would benefit from his half of the house, my half of the house and some cash, I may well still be liable for some repairs, and at some point in future I would have CGT to worry about. For him, I guess it's the best option - he gets to live in the house for as long as he likes despite not owning all of it and he also gets a bit of cash.

At the moment I am feeling that if he is insistent that he wants to live in the house and won't even consider selling (and I appreciate it would be hard to sell while he still lives there) then he needs to own it 100%.  I'll try to talk to him about whether he really can afford the upkeep of somewhere not in great condition while unemployed and suggest that a newer smaller place might be easier and cheaper to run, but I don' know if he will listen.

Keep_pedalling

DepositSaver said:

I sent my brother some suggestions for what could be done earlier, including that he have all the house and I have the cash, that we own the house 50/50 but he is responsible for all the upkeep and maintenance, or that we sell and he get more of the proceeds. His response was to ask if we own the house 50 / 50 and he were responsible for all the upkeep, would the cash also be split 50 / 50. That feels like the worst option for me as I would in benefit from a small amount of cash, he would benefit from his half of the house, my half of the house and some cash, I may well still be liable for some repairs, and at some point in future I would have CGT to worry about. For him, I guess it's the best option - he gets to live in the house for as long as he likes despite not owning all of it and he also gets a bit of cash.

At the moment I am feeling that if he is insistent that he wants to live in the house and won't even consider selling (and I appreciate it would be hard to sell while he still lives there) then he needs to own it 100%.  I'll try to talk to him about whether he really can afford the upkeep of somewhere not in great condition while unemployed and suggest that a newer smaller place might be easier and cheaper to run, but I don' know if he will listen.

I think you need to work at this. It may take some time especially with lockdown, but hopefully he will come round to the idea that owning something smaller, more modern and cheaper to run is the best thing for hIm. Get him to look at all the expenditure associate with the current house ( council tax, heating costs etc) and the potential big ticket unexpected costs he could be hit with (replacement boiler, roof repairs). If you can gently show him what the financial implications are going to be to stay put he might be more willing to make the move.  

bouicca21

Could you do a right move search with him so that he can see the sort of house he could afford?  Jumping into the unknown may be very frightening fir him - looking on the net and maybe doing a drive by until it is possible to view properties might be a gentle way to focus his thoughts.

DepositSaver

xylophone said:

 He said he "doesn't know how to buy a house". 

Tell him that you do?

I told him I do, he then started saying he doesn't want another house, he wants to stay where he is. 

Flint19

DepositSaver said:

xylophone said:

 He said he "doesn't know how to buy a house". 

Tell him that you do?

I told him I do, he then started saying he doesn't want another house, he wants to stay where he is. 

You are behaving with great patience and restraint, but the phrase 'never a good deed goes unpunished' popped into my mind as I read this thread! Like you, your brother has lost his dad and the prospect of losing his home must be quite frightening. It is a much bigger change in lifestyle for him than for you. 

The snag is that the longer your brother goes on believing there is a chance you'll agree to letting him stay in the house, the less likely it is that he'll be willing to have an encounter with reality - you are shielding him. From what you've said, he isn't listening and he isn't going to listen, so a more determined approach to the future, with plenty of hand holding from you, might be your only viable answer.

Could you perhaps look on RightMove and Zoopla, find some suitable properties which might be affordable (even if it does take a bit more than half the expected sale proceeds of your father's property), and gradually bring the conversation round to 'when' not 'if' he buys?

Not easy, especially when you too have been bereaved, but there may not be many viable alternatives.

sammyjammy

Is he likely to remain unemployed?  I can't remember how much cash/car value was but half of that may put his benefits at risk.  How old is he?  Is he vulnerable at all?