Mum buying out ex husband share of house and spying off mortgage.

jasminedivas

I am in the position that my Dad has recently passed away and my mum wants to buy out my ex husbands share of my house and pay off my mortgage until I am able to get my own mortgage in 4-5 years time when I have finished university and secured a job. 

The property is worth £300k, the mortgage is £112k and my husbands share is £70k.  So my mum will pay £182k, she already has her own home, so will she need to pay stamp duty on the £182k?  I have just seen a thread about a property having a charge on it.  Could I do this for the £182k ? Are there any other options? 

Are there any implications when I get my own mortgage on the property? 

Also if my mum passes away whilst she still has the money in my house does it just form part of her estate and I can take that as my share from my 2 brothers?  

If anyone has any advice I would be greatly appreciate it, thank you. 

mat1964

Yes SDLT would be payable to transfer ownership - but if you can get it done by end September it would be below the tapered threshold of £250k.

In the event that your mother passes away in the next 7 years, the IHT would be payable, but it depends on the value of the estate.

jasminedivas

mat1964 said:

Yes SDLT would be payable to transfer ownership - but if you can get it done by end September it would be below the tapered threshold of £250k.

In the event that your mother passes away in the next 7 years, the IHT would be payable, but it depends on the value of the estate.

As she already has her own property I presume she will have to pay 3%? 

Mojisola

She could just loan you the money - get it all documented and signed. 
She can then put a charge on the house so that her money is returned when the house is sold or you raise a mortgage. 

AdrianC

So your mother wants to pay £182k into your £300k property.
It would make most sense for her to lend you the money, with a charge against it. That way, she pays no SDLT, because she doesn't OWN any of it.

When she dies, that's a £182k debt you owe her estate. That can form part of any bequest you get, or her will could explicitly clear the debt.

A greater risk may be that she needs residential care, exhausts her other assets, and the local authority look to you to repay the debt in order to pay for her care. But, of course, we have no idea what other assets she has.

mat1964

jasminedivas said:

mat1964 said:

Yes SDLT would be payable to transfer ownership - but if you can get it done by end September it would be below the tapered threshold of £250k.

In the event that your mother passes away in the next 7 years, the IHT would be payable, but it depends on the value of the estate.

As she already has her own property I presume she will have to pay 3%? 

I assumed it was going to be a loan and the property would just be transferred into the OP's name?

sheramber

my mum wants to buy out my ex husbands share of my house 

I think  the OP owns the house jointly with ex but cannot get a mortgage to buy out ex so mum is going to loan  the money to pay off outstanding mortgage and buy hime out. 

House will then be in OP's name only.

When OP can get her own mortgage on property she can repay her mother.

jasminedivas

sheramber said:

my mum wants to buy out my ex husbands share of my house 

I think  the OP owns the house jointly with ex but cannot get a mortgage to buy out ex so mum is going to loan  the money to pay off outstanding mortgage and buy hime out. 

House will then be in OP's name only.

When OP can get her own mortgage on property she can repay her mother.

Yes that is correct.  I didn’t know that the house could just stay in my name though, I thought as my mum was putting money into it that she would have to be an owner too.  She will be quite happy with just a charge. 

jasminedivas

mat1964 said:

jasminedivas said:

mat1964 said:

Yes SDLT would be payable to transfer ownership - but if you can get it done by end September it would be below the tapered threshold of £250k.

In the event that your mother passes away in the next 7 years, the IHT would be payable, but it depends on the value of the estate.

As she already has her own property I presume she will have to pay 3%? 

I assumed it was going to be a loan and the property would just be transferred into the OP's name?

I didn’t know I could do this, Thanku. 

AdrianC

jasminedivas said:

sheramber said:

my mum wants to buy out my ex husbands share of my house 

I think  the OP owns the house jointly with ex but cannot get a mortgage to buy out ex so mum is going to loan  the money to pay off outstanding mortgage and buy hime out. 

House will then be in OP's name only.

When OP can get her own mortgage on property she can repay her mother.

Yes that is correct.  I didn’t know that the house could just stay in my name though, I thought as my mum was putting money into it that she would have to be an owner too.  She will be quite happy with just a charge. 

Think of your mum as just another mortgage lender.

elsien

And with regards to the query about what happens if your mum passes, that would depend on what she’s put on her will which it would probably be sensible of her to make if she hasn’t already.