Loan for Purchase - why is this so difficult.

[Deleted User]

Deleted_User said:

Loza2016 said:

Not sure why it needs to be gift. 

We did this end of 2020. In-laws  paid for our property as we needed to be cash buyers before our sale completed. 

We signed documents to put a charge on the property & confirm interest would be paid in line with Bank of England base rate. 

All done by the solicitor who had previously done the same for my SIL. 

@Charliecloud I'm in the same boat as @Loza2016. We did very similar in 2020. We got an agreement contract / document from the internet that covered everything we wanted and that was agreed between us and my parents. The only difference was that we insisted on paying back an element of interest so this was factored in to the agreement. 


Our solicitors asked to see this agreement along with a letter signed by my parents to also explain the situation and what they wanted to do. I think other than that my parents didn't have to do anything (other than they did have to show the source of their funds as per usual regulations). I can't really understand why you're having such an issue when it's the entirety of the purchase price.

Ah thinking about it - I know we were asked if my parents wanted a charge on the property. As they didn't there was no issue. Solicitor did say it gets more complicated when a charge is wanted. Do you want to register a charge on the property? That could explain a conflict of interest.

Just had a quick look at a previous post you made and it seems you are needing a declaration of trust or charge on the property. I suspect this may be the issue and you need a different solicitor to act for you?

housebuyer143

My mate is looking to remove her partner from a £2k piece of land in where they originally requested joint names on it.

He agreed he didn't want to be on the deeds but the solicitor will not accept this and he needs to get independent legal advice and a signed letter from the solicitors saying he has had it. Maybe it's similar in this case? 

SuseOrm

housebuyer143 said:

My mate is looking to remove her partner from a £2k piece of land in where they originally requested joint names on it.

He agreed he didn't want to be on the deeds but the solicitor will not accept this and he needs to get independent legal advice and a signed letter from the solicitors saying he has had it. Maybe it's similar in this case? 

Yes it’s almost as if they need to create work for themselves isn’t it ? I had a similar situation where my 17-year-old who does not live with me was required to spend £500 going online on a teams call with a solicitor to sign a document to say that she wouldn’t stake a claim in my house.  

user1977

housebuyer143 said:

My mate is looking to remove her partner from a £2k piece of land in where they originally requested joint names on it.

He agreed he didn't want to be on the deeds but the solicitor will not accept this and he needs to get independent legal advice and a signed letter from the solicitors saying he has had it. Maybe it's similar in this case? 

I think it's more complex here as it sounds like the solicitor has already accepted instructions both from the OP and their son (though the OP hasn't clarified that). The solicitor should really have recognised that as a conflict of interest as soon as a loan was mentioned.

Charliecloud

It's now resolved    Solicitor sent email to my son advising that he needed to confirm: I. It was a loan and not a gifted deposit and would be recorded as such. 
2.if you wish to re-mortgage the property with a commercial bank in the future. You would need to disclose any private loan agreements in place at the time of making your application with the commercial bank. Issues arising regarding selling the property before the insolvency rules no longer apply . The official receiver usually checks what you gave away or sold for up to 5 years before you went bankrupt. For the 2 years before you went bankrupt, the official receiver checks everything you gave away or sold. This means, if your parents go bankrupt within two years of the date of completion of this house, the official receiver can make a claim on your home and up to 5 years after you sell the property. 

All paperwork now complete and fingers crossed exchange will happen tomorrow and completion on Friday.

Thanks for all input

Brie

Glad it worked out ok and hope all goes well on Friday too.