concessionary mortgage

Deniseconfused

I have a second house valued at £525,000. It has an outstanding mortgage of £130,000. 

I plan to sell this house to my special needs son for £130,000.  He will need a mortgage of £110,000 and he'll put £20,000 in himself. 

QUE - His income is plenty to get a mortgage of that amount. Is it that simple. He has excellent credit history. 

My main residence I'll leave in my will to my other son ( same equity ) . He already owns a house for which I gave him 10%

hopefully I live 7 years so only main residence is up for IHT calculation and hopefully will be under the limit then. 

Its vital special needs son or my partner doesnt have to sell to raise IHT payments. 

I know Im in the hole for CGT of the market value of the second house. 

Hoenir

Deniseconfused said:

QUE 2 - However am I right that the SDLT ( England ) will be assessed on the £130,000 genuine bargain purchase price? 

Most likely fall under a connected party transaction and be assessible as such for stamp duty.  In essence "the property should be valued at the price which it might reasonably be expected to fetch on the open market assuming a willing seller and a willing buyer". 

Keep_pedalling

SDLT will be based on the amount he pays rather than the value.

When you say you say partner would I be correct in thinking you are not married? If so your estate is likely to be hammered with IHT if you die first.

If this all goes through I would recommend you take out term insurance to cover the possibility of you meeting an untimely death before the 7 years are up. 

Typhoon2000

Hoenir said:

Deniseconfused said:

QUE 2 - However am I right that the SDLT ( England ) will be assessed on the £130,000 genuine bargain purchase price? 

Most likely fall under a connected party transaction and be assessible as such for stamp duty.  In essence "the property should be valued at the price which it might reasonably be expected to fetch on the open market assuming a willing seller and a willing buyer". 

No ‘ connected party’ is in relation to CGT not stamp duty.