Paying off dad's mortgage before he loses his home?

charley1

peb said:

https://www.lease-advice.org/calculator/

Use the above.

Brie, your plan would work to a point but if the OPs dad gets into future financial difficulties then charges could be placed on the register 

This is what I am trying to avoid 🤞🏻

theoretica

How far off meeting legal standards for a rented property is it?  I suspect you would legally be becoming your dad's landlord and need to meet those standards.

charley1

theoretica said:

How far off meeting legal standards for a rented property is it?  I suspect you would legally be becoming your dad's landlord and need to meet those standards.

I would say very far off, though I won't know for sure until later in the week, my plan is to gut the whole place for his sake so he has somewhere decent to live. 

housebuyer143

Might be controversial but clearly he's not supporting himself very well. Is it worth potentially trying to arrange some supported accommodation with the council instead of trying to preserve this property where he has huge maintenance issues and needs you to run and maintain the home? 

If he sells the property or it's repoessed he would be homeless and might be priority for rehousing. Falling that, surely private rental and claiming HB to cover the rent could also work. Suppose it depends were you are and rental prices. I know you really want to keep him in this house, but is it really the best solution? 

The lease extension will only get more and more expensive the longer you leave it. 

Edi81

What about paying the mortgage off and placing a charge over the property in your name? A mortgage is just a legal charge that the lender has. That would mean you wouldn’t own the property but are first in line to be repaid upon sale. 

Bookworm105

pay off the mortgage in full, but do not change the ownership. That way avoids you having second home SDLT to pay, plus all other tax implications of being a second home owner.

Inheritance tax does not sound like a realistic risk, so leaving it in his name won't affect that, and avoids you having to pay capital gains tax were you its owner when it is sold 

protect your "investment" by putting a first charge on the property, ie do what the mortgage company does. If dad sells up for care home purposes for example, then as first charge your sum of money would need to be paid to you before the remainder can be spent on dad's needs.
Obviously the charge could, if you wish, include an interest rate that is compounded to protect your money against inflation (to an extent!)

RAS

charley1 said:

RAS said:

Think you need to start with facts, not emotions. 

What is the current value, value after lease extension and value with essential repairs?

What is the mortgage, how much other debt is secured on the property (that would probably have to be cleared before any property ownership change), any debts to the freeholder or management company, cost of lease extension, and cost of essential repairs?

Start by getting the deeds from the Land Registry (£3) to check for secured debt, and spend £7 on the lease?

What's dad's situation regarding state pension? Any other pension(s)?

I have already purchased the deeds from land registry, no secured debt showing other than the mortgage, his credit report shows the ccjs - how much etc and they have been added to the mortgage amount (4 separate ccjs over 4 years) so I can only presume these ccj debts were owed to the freeholder /property management company?  As the debt is being added to the mortgage? Please correct me if thats not necessarily the case it's just my assumption. 

Err.....no.

It is really important that you understand that the CCJs remain unsecured, and that neither you or dad contact the creditors.

If they don't enforce the CCJ within 6 years, it becomes unenforceable. So you can forget about them.

However, if these CCJs have been issued by the freeholder or property management company, you need more specialist advice. There should be a court reference? It's likely to be Northampton Court if it's consumer credit. Ask them for details of the case.

charley1

RAS said:

charley1 said:

RAS said:

Think you need to start with facts, not emotions. 

What is the current value, value after lease extension and value with essential repairs?

What is the mortgage, how much other debt is secured on the property (that would probably have to be cleared before any property ownership change), any debts to the freeholder or management company, cost of lease extension, and cost of essential repairs?

Start by getting the deeds from the Land Registry (£3) to check for secured debt, and spend £7 on the lease?

What's dad's situation regarding state pension? Any other pension(s)?

I have already purchased the deeds from land registry, no secured debt showing other than the mortgage, his credit report shows the ccjs - how much etc and they have been added to the mortgage amount (4 separate ccjs over 4 years) so I can only presume these ccj debts were owed to the freeholder /property management company?  As the debt is being added to the mortgage? Please correct me if thats not necessarily the case it's just my assumption. 

Err.....no.

It is really important that you understand that the CCJs remain unsecured, and that neither you or dad contact the creditors.

If they don't enforce the CCJ within 6 years, it becomes unenforceable. So you can forget about them.

However, if these CCJs have been issued by the freeholder or property management company, you need more specialist advice. There should be a court reference? It's likely to be Northampton Court if it's consumer credit. Ask them for details of the case.

Yes there are case numbers against the ccjs and they come under civil national business centre, after a quick Google is Northampton court. The amounts the ccjs show seem to be added to his mortgage amount and have for the last 4 years which is why I presumed they were freehold /management company. I am going to see if I can find out what they are for certain. Thanks again. 

charley1

Bookworm105 said:

pay off the mortgage in full, but do not change the ownership. That way avoids you having second home SDLT to pay, plus all other tax implications of being a second home owner.

Inheritance tax does not sound like a realistic risk, so leaving it in his name won't affect that, and avoids you having to pay capital gains tax were you its owner when it is sold 

protect your "investment" by putting a first charge on the property, ie do what the mortgage company does. If dad sells up for care home purposes for example, then as first charge your sum of money would need to be paid to you before the remainder can be spent on dad's needs.
Obviously the charge could, if you wish, include an interest rate that is compounded to protect your money against inflation (to an extent!)

If I did this, would my money be repaid on sale of the property before any other charge ccjs etc that could be added in future ? 

charley1

housebuyer143 said:

Might be controversial but clearly he's not supporting himself very well. Is it worth potentially trying to arrange some supported accommodation with the council instead of trying to preserve this property where he has huge maintenance issues and needs you to run and maintain the home? 

If he sells the property or it's repoessed he would be homeless and might be priority for rehousing. Falling that, surely private rental and claiming HB to cover the rent could also work. Suppose it depends were you are and rental prices. I know you really want to keep him in this house, but is it really the best solution? 

The lease extension will only get more and more expensive the longer you leave it. 

Not controversial at all, I totally agree with you, he is not good at supporting himself, he never has been really, but has got a lot worse over recent years, it's definitely an option I have considered and still am, I'm just trying to find the best solution to help him in the long run and paying off the mortgage is one option I am considering, thus forum has been really helpful to me in the past so wanted to get impartial advice, you have all been so helpful, I am truly thankful.