Part selling/ part gifting property to our daughter.

Mutabilisrose

Our home is worth around £400000. There is around £120000 left on the mortgage (plus a loan). I want to gift part of the property to her and want to sell at £150000. We will continue to live with her until she gets a partner/husband/friend and will be paying rent. My husband has been out of work for 18 months and we have been using my pension lump sum to manage. This has dwindled dramatically. Has anyone done this or has any advice. Just as a side note I am not worried about the position this will put us in, I just need to know if we can do it. Her salary is only £18500 basic plus bonuses of around £300 a month (obviously not guaranteed).  PPS I am 56, hubby is 54 and we are in good health. Hubby has been trying to get a job for 18months. My lump sum is now £30000 and my work pension is £1000. No other money is coming in.

[Deleted User]

Daughter could do a concessionary purchase where you gift the equity abd she takes a mortgage for the rest. 
Cant see her being able to raise enough on just her income to make it work though.  At a guess she'd get a maximum of around £90k ish on her own with no current debts.  Obviously this wouldn't give you enough to clear your mortgage so wouldn't be possible 

SpiderLegs

Is the daughter going to get a 150k mortgage on that salary?

K_S

Mutabilisrose said:

Our home is worth around £400000. There is around £120000 left on the mortgage (plus a loan). I want to gift part of the property to her and want to sell at £150000. We will continue to live with her until she gets a partner/husband/friend and will be paying rent. My husband has been out of work for 18 months and we have been using my pension lump sum to manage. This has dwindled dramatically. Has anyone done this or has any advice. Just as a side note I am not worried about the position this will put us in, I just need to know if we can do it. Her salary is only £18500 basic plus bonuses of around £300 a month (obviously not guaranteed).  PPS I am 56, hubby is 54 and we are in good health. Hubby has been trying to get a job for 18months. My lump sum is now £30000 and my work pension is £1000. No other money is coming in.

@Mutabilisrose To add to what JMA has said above, a concessionary purchase might be tricky as it usually includes the condition that the vendor (you and husband) must not reside in the property after completion. At first glance it doesn't look doable, both in principle and due to the the numbers not stacking up.

MWT

Unless there is significant missing information, this is not only very unlikely to be possible, but extremely ill-advised as well.

On the numbers you've given, you really can't afford to be giving away the majority of the only significant asset you appear to own.

So unless your daughter has a large amount of cash in the bank this is a non-starter.

However there is plenty of help available on this and other sections of the site that can help you work out a sustainable way forwards given your current situation, but that isn't likely to include giving away a large percentage of your house...

Mutabilisrose

Thanks for the replies guys. Will they not take into account that she will own over 50% of the property so £250,000 in assets. So even if she couldn’t for whatever reason pay the repayments there is still enough equity in the house to pay off what she owed?

Mojisola

Mutabilisrose said:

Our home is worth around £400000. There is around £120000 left on the mortgage (plus a loan). I want to gift part of the property to her and want to sell at £150000. We will continue to live with her until she gets a partner/husband/friend and will be paying rent.

My lump sum is now £30000 and my work pension is £1000. No other money is coming in.

Wouldn't it be better to downsize so that you don't have mortgage payments to find?

If you give away such a large lump of capital but then pay rent on what you previously owned, how will you be better off?

Mutabilisrose

MWT said:

Unless there is significant missing information, this is not only very unlikely to be possible, but extremely ill-advised as well.

On the numbers you've given, you really can't afford to be giving away the majority of the only significant asset you appear to own.

So unless your daughter has a large amount of cash in the bank this is a non-starter.

However there is plenty of help available on this and other sections of the site that can help you work out a sustainable way forwards given your current situation, but that isn't likely to include giving away a large percentage of your house...

Where could I ask about other options please? The only other things I saw were using one of the firms that but your home and you pay rent to live in it and losing our home when my money runs out. 

Mutabilisrose

Deleted_User said:

Daughter could do a concessionary purchase where you gift the equity abd she takes a mortgage for the rest. 
Cant see her being able to raise enough on just her income to make it work though.  At a guess she'd get a maximum of around £90k ish on her own with no current debts.  Obviously this wouldn't give you enough to clear your mortgage so wouldn't be possible 

Do they not count that she has £250,000 of equity in the property and we are paying rent?

Mutabilisrose

Mojisola said:

Mutabilisrose said:

Our home is worth around £400000. There is around £120000 left on the mortgage (plus a loan). I want to gift part of the property to her and want to sell at £150000. We will continue to live with her until she gets a partner/husband/friend and will be paying rent.

My lump sum is now £30000 and my work pension is £1000. No other money is coming in.

Wouldn't it be better to downsize so that you don't have mortgage payments to find?

If you give away such a large lump of capital but then pay rent on what you previously owned, how will you be better off?

If we can sell in time before we run out of money. Selling a house at that price where I live is not easy. They stay on the market months. I am not bothered about us being "better off" my aim is to help my daughter and not lose what we wanted her to inherit, if I can.

Mutabilisrose

K_S said:

Mutabilisrose said:

Our home is worth around £400000. There is around £120000 left on the mortgage (plus a loan). I want to gift part of the property to her and want to sell at £150000. We will continue to live with her until she gets a partner/husband/friend and will be paying rent. My husband has been out of work for 18 months and we have been using my pension lump sum to manage. This has dwindled dramatically. Has anyone done this or has any advice. Just as a side note I am not worried about the position this will put us in, I just need to know if we can do it. Her salary is only £18500 basic plus bonuses of around £300 a month (obviously not guaranteed).  PPS I am 56, hubby is 54 and we are in good health. Hubby has been trying to get a job for 18months. My lump sum is now £30000 and my work pension is £1000. No other money is coming in.

@Mutabilisrose To add to what JMA has said above, a concessionary purchase might be tricky as it usually includes the condition that the vendor (you and husband) must not reside in the property after completion. At first glance it doesn't look doable, both in principle and due to the the numbers not stacking up.

I thought you could live there if you pay rent?