How would I do it ?

Wotulookinat

Following a recent bereavment I have inherited 50% of my parents bungalow along with my sister who inherits the other half. We have ageed between us that I will buy the bungalow to live in and in order for me to do this I will need to buy my sisters half, approx £170k and spend a further £100k renovating the bungalow to how I would want it, then sell my own house when the bungalow is finished and ready to move in. 

So, the figures:-
We have agreed a value of £340k for the bungalow.
My own house is worth about the same and I have no mortgage.
I have about £200k ready available money invested in a S&S isa if needed
Ideally I would like to raise £200 - £250k over a period of 5 years to fund most of the project.

I am allowing 5 years to get all the plans and design sorted, find a builder, carry out the renovation and then sell my own house. Obviously, I would want the project to be completed in well under 5 years but I don't want to put myself under pressure with deadlines looming so am allowing what I consider to be ample time.

I am 66, married (wife is 60), both retired and we currently take £25k p/a from our flexi drawdown pensions to live on and take profits from our s&s isas for non essentials. Current monthly outgoings to cover all household / food/ vehicles etc. approx £1300 / mth.

Over the past 4 years we have taken an average £53k p/a from our pensions and isas and both have grown in value to more now that when we first retired. We haven't paid any income tax at all since we retired 4 years ago and I have just started receiving my full state pension ( and subsequently reduced my drawings from my sipp to keep within the tax threshold)

No other debts, loans, etc. and have a cash reserve of about £30k in bank accounts.

Would I be able to raise the £200-250k, and if so, what would be the best product to go for ?

Thanks

[Deleted User]

What's the total value of the sipp? Lenders calculate income based on fund value

Wotulookinat

Sipp is around £205k at present

getmore4less

Any way to get the project done quicker or stages to get it liveable and finish off while resident?

Would sis be happy to act as your lender for her share and you pay her monthly for while or does she need the full £170k now

Wotulookinat

getmore4less said:

Any way to get the project done quicker or stages to get it liveable and finish off while resident?

Would sis be happy to act as your lender for her share and you pay her monthly for while or does she need the full £170k now

Compromises may be possible, indeed may have to be possible, but I wanted to start by looking at the best possible scenario ie. I borrow enough to pay sis and refurb the bungalow, then move in and sell my house to clear the loan and put me back to the financial position I am in now.

I have a good relationship with my sister and we are good friends, so wouldn't want to spoil that, but I'm sure she would help me out if I was really stuck. Also, I don't really want to live on a building site as the renovations required are quite extensive, and time-wise I didn't want to tie myself up with too tight a schedule

I just had in my mind that, on paper, I would be the owner of two properties worth around £700k and have liquid and pension assets approaching half a million, surely I should be able to secure some financial assistance ? 

lonibra

As a source of income for a mortgage, Banks are more conservative with SIPPs and drawdowns than with regular private pensions. I tried using mine to get a longer term but it was too much hassle as I was limited to a few tiny building societies who needed tons of paperwork and cost more than big Banks.

I would talk to an MB, there should be something out there with your numbers.