Being left a share in a flat.

Laurieo

My late friend left a 1/3 each of a share in his flat to his two children and a 1/3 of a 1/3 to each of his 3 grandchildren .
Now the intention is to keep the flat and rent it out.
How would the grandchildren be 'classed 'if they wanted to get a mortgage later in life.(All living at home at school /college )
Would they be second home owners ?.
  

Brie

Yes and also not eligible for an first time buyer bonuses.  And be subjected to CGT as it isn't their primary residence. 

Frankly it would be more sensible if the estate (somehow, not sure how) sold the GCs' shares to the children and the money be held in trust (or something maybe into a LISA?) 

MWT

No need to sell the shares to the children, just a simple deed of variation should take care of it.

Then assuming good will on all sides it is just a matter of letting the parents take care of their own children's interest.

Otherwise it gets tricky to deal with the grandchildren's beneficial interest without triggering any of the problems you are trying to avoid.

Keep_pedalling

MWT said:

No need to sell the shares to the children, just a simple deed of variation should take care of it.

Then assuming good will on all sides it is just a matter of letting the parents take care of their own children's interest.

Otherwise it gets tricky to deal with the grandchildren's beneficial interest without triggering any of the problems you are trying to avoid.

If the grand children are minors they can’t do a deed of variation. 

MWT

Keep_pedalling said:

MWT said:

No need to sell the shares to the children, just a simple deed of variation should take care of it.

Then assuming good will on all sides it is just a matter of letting the parents take care of their own children's interest.

Otherwise it gets tricky to deal with the grandchildren's beneficial interest without triggering any of the problems you are trying to avoid.

If the grand children are minors they can’t do a deed of variation. 

I believe it is possible, but it would require Court consent, which given the unintended impact of the bequest shouldn't be too hard to get I would hope...

silvercar

Keep_pedalling said:

MWT said:

No need to sell the shares to the children, just a simple deed of variation should take care of it.

Then assuming good will on all sides it is just a matter of letting the parents take care of their own children's interest.

Otherwise it gets tricky to deal with the grandchildren's beneficial interest without triggering any of the problems you are trying to avoid.

If the grand children are minors they can’t do a deed of variation. 

Minors can't hold property in their own name. It would need to be a trust. If the trust held the property, that wouldn't effect the minors FTB status.

Keep_pedalling

MWT said:

Keep_pedalling said:

MWT said:

No need to sell the shares to the children, just a simple deed of variation should take care of it.

Then assuming good will on all sides it is just a matter of letting the parents take care of their own children's interest.

Otherwise it gets tricky to deal with the grandchildren's beneficial interest without triggering any of the problems you are trying to avoid.

If the grand children are minors they can’t do a deed of variation. 

I believe it is possible, but it would require Court consent, which given the unintended impact of the bequest shouldn't be too hard to get I would hope...

That would never fly. The will does not create any unintended consequences it’s the adults wanting to become landlords that does that. The simple solution here is to sell up and put the children’s share in trust until they are 18 or for the adults to buy out the children’s share and hold that in trust until they are 18.

With so many landlords selling up and getting out of the rental market what makes them think this is the best option for this inheritance?

Keep_pedalling

silvercar said:

Keep_pedalling said:

MWT said:

No need to sell the shares to the children, just a simple deed of variation should take care of it.

Then assuming good will on all sides it is just a matter of letting the parents take care of their own children's interest.

Otherwise it gets tricky to deal with the grandchildren's beneficial interest without triggering any of the problems you are trying to avoid.

If the grand children are minors they can’t do a deed of variation. 

Minors can't hold property in their own name. It would need to be a trust. If the trust held the property, that wouldn't affect the minors FTB status.

Each share would need to be held in a bare trust, and that would affect their FTB status.