Buying house for Son

Thrugelmir

mcn99 said:

I'm more concerned with the process of basically protecting what is essentially a gift with strings,  i dont really expect the money to be paid back, but i want to make sure that he doesnt squander it.

 

Why not fund a deposit initially then. Over time drip feed small amounts straight into the mortgage account once he has proven to be mature enough for home ownership. 

babyblade41

I did this for my daughter but she is very trustworthy with an excellent job... the reason I did it was she could use the large deposit she had saved to do all the renovations that she wanted to do and she has done an amazing job.

I am not on the deeds and didn't have a declaration but because she wouldn't accept as a gift she repays me every month 

MEM62

@mcn99 You are potentially saddling your son with a CGT from day one.  (He might not thank you for that!)  You are also providing him with an asset that could potentially be claimed should be fall into debt.  Although there are ways to protect your financial interest in the way that you wish, they are complicated and contain risk.  And at the end of the day I am sure that your lack of trust in your son has a reason behind it.  Therefore, trust your instinct and don't so this.  

Mrs_pbradley936

We did something similar about 20 years ago when our son was going to university. We thought he was going to Nottingham and at the time you could buy a 4 bed house there for about £60K. The idea was to let the other rooms out to cover the mortgage. Things changed when he went to Southampton and you could not buy a 4 bed house there for the same money so we bought a flat near us. We paid the mortage which was £300 a month and let him have the rental income which was £500 a month to live on. We bought it in trust and he gets it when we die. He lives in it now.

MobileSaver

mcn99 said:

I dont believe any council could argue, that in 20 years time i deliberately tried to avoid care costs.

I'm sorry i'm not interested in arguing asset deprivation.

I'm more concerned with the process of basically protecting what is essentially a gift with strings,

That's your problem though!

Because this is "a gift with strings" I suspect it absolutely will be an issue with both council care asset deprivation and IHT when the time comes, whether that be 2 years or 20 years from now; to all intents and purposes the value of your son's house will forever be included in your estate value while the "strings" are still in place.

I think you need to decide which aspect is more important; protecting your money in case your son messes up or protecting your money against council/government fees/taxes in the future. I don't know of any reliable way you can have it both ways but it will be interesting to hear what your solicitor has to say.

babyblade41

If I was you I wouldn't be doing anything at all if he is that irresponsible... enjoy retirement an wait for him to grow up and take responsibility for his own money and not yours .

I think you could be making a costly mistake 

newsgroupmonkey_

MEM62 said:

@mcn99 You are potentially saddling your son with a CGT from day one.  (He might not thank you for that!)  You are also providing him with an asset that could potentially be claimed should be fall into debt.  Although there are ways to protect your financial interest in the way that you wish, they are complicated and contain risk.  And at the end of the day I am sure that your lack of trust in your son has a reason behind it.  Therefore, trust your instinct and don't so this.  

Wait, what?

How is he getting into CGT. House is in his name, but with a charge against the property for the OP (We discussed this and it seems the most sensible way forward).

If HE (i.e. the son) falls into debt, that's great, but the OP still has his charge which comes first.