Elderly person buying council house

Chattykathyblueblue

This is a situation within my wider family
Woman aged 79 has the right to buy her council house at a massive discount with a view to giving it to her adult grandson. Grandson has been good to her (unlike adult children) House has been valued at £165K and she could have it for £62K. What would be the best way to go about borrowing this kind of money, is it even possible for a woman of her age? Grandson could get a mortgage for that amount but I presume that doesn't actually help as the house is in the grandma's name. TIA

itsthelittlethings

Has she got a good pension?

Albermarle

If you sell a 'Right to Buy' council home within 12 months of buying it, then you have to repay 80% of the discount.
I would presume the same rule would apply if you gave it away.
In any case where is she going to live ?

Grumpy_chap

Chattykathyblueblue said:

This is a situation within my wider family
Woman aged 79 has the right to buy her council house at a massive discount with a view to giving it to her adult grandson. Grandson has been good to her (unlike adult children) House has been valued at £165K and she could have it for £62K. What would be the best way to go about borrowing this kind of money, is it even possible for a woman of her age? Grandson could get a mortgage for that amount but I presume that doesn't actually help as the house is in the grandma's name. TIA

The right to buy will only apply to the lady residing at the house (assuming that she lives alone).
The Grandson will not be able to obtain a mortgage on a property he is not buying and has no right to buy.
Does the lady have the £62k available to buy the house?
Can she do that without depriving herself of the funds she may require for her own needs?  Have particular consideration to possible care costs that may arise in the future even if she if independent and capable now.
Usually the tenant buying a property under the right to buy will have to retain the property and continue living in the property as primary residence for a number of years before the property can be sold on.  (I do not know how these rules are interpreted in the case of the death of the individual.)
She might have to buy the property and leave it to the Grandson in her Will.

SarahB16

Chattykathyblueblue said:

This is a situation within my wider family
Woman aged 79 has the right to buy her council house at a massive discount with a view to giving it to her adult grandson. Grandson has been good to her (unlike adult children) House has been valued at £165K and she could have it for £62K. What would be the best way to go about borrowing this kind of money, is it even possible for a woman of her age? Grandson could get a mortgage for that amount but I presume that doesn't actually help as the house is in the grandma's name. TIA

I presume she would only give the council house to her grandson after she had passed?  

Keep_pedalling

Has this person actually put in an application to buy, and if so was the application made before November 21st 2024?

The available discounts were greatly reduced after that date with the maximum in most parts of the country having been limited to £34k.

Yorkie1

What sort of condition is the property in? As a council tenant, she does not have to bear responsibility for roof etc. Once she owns it, it's up to her (and her cost).

Chattykathyblueblue

To answer questions so far 

The house is in great condition, it's very well maintained 

Yes, she's applied before the rule changes hence it being offered for £62k and valued at £165k. 

She will continue living there but only has a state pension and a very small widow's pension. This is the crux of the matter as she doesn't have the means to repay the £62k.

Keep_pedalling

Chattykathyblueblue said:

To answer questions so far 

The house is in great condition, it's very well maintained 

Yes, she's applied before the rule changes hence it being offered for £62k and valued at £165k. 

She will continue living there but only has a state pension and a very small widow's pension. This is the crux of the matter as she doesn't have the means to repay the £62k.

Then it seems like a non starter. As owner she would be responsible for all upkeep on the property and it does not would like she would have the means to carry out expensive repairs like a new boiler or major roof repairs.

From her point of view she is better off staying as she is as a secured tenant.

Grumpy_chap

Chattykathyblueblue said:

she doesn't have the means to repay the £62k.

It kind of sounds as though this idea is not going to happen then.
She has to buy the house, not anyone else, as no-one else gets the discount under right-to-buy.
She cannot afford to buy the house from her own funds.
Can anyone else afford to gift her the money to buy the house?  An actual gift, without any constraint or expectation of having the money back at any time?  Given the Grandson is then indicated to be left the house in the Will, one assumes no-one other than the Grandson would make the gift, unless there is someone that would gift the Grandson £62k anyhow.
Even if she received a gift that allowed her to buy the house and then leave the house in her Will to the Grandson, there is no absolute certainty that she will not need care at some point in the future and the LA place a charge on the house to allow them to recover their costs of funding care while she is alive.

GDB2222

How much rent would she be saving? 

Could the grandson raise £62k without a charge on the property? Could he guarantee grandma's interest payments if she could obtain a mortgage?