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    • Tgall1
    • By Tgall1 7th Jan 20, 8:55 PM
    • 2Posts
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    Tgall1
    Buying house from father
    • #1
    • 7th Jan 20, 8:55 PM
    Buying house from father 7th Jan 20 at 8:55 PM
    Thinking of buying family home from father, at moment it is going to be left to me and two sisters but everyone as agreed to let me buy it at below market value and cater then give some money to sisters. Whatís the best way to go about this ? Dad to sell to me and me get a mortgage to pay him or is their a better way of going about it.
    Thanks
    Tony
Page 1
    • jaybeetoo
    • By jaybeetoo 7th Jan 20, 9:07 PM
    • 1,143 Posts
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    jaybeetoo
    • #2
    • 7th Jan 20, 9:07 PM
    • #2
    • 7th Jan 20, 9:07 PM
    Where is dad going to live after the sale?
    • KatrinaWaves
    • By KatrinaWaves 7th Jan 20, 9:07 PM
    • 1,148 Posts
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    KatrinaWaves
    • #3
    • 7th Jan 20, 9:07 PM
    • #3
    • 7th Jan 20, 9:07 PM
    There are lots of things to consider, one of which is where will your father be living once you buy the property? If he needs to claim benefits or if he requires care soon then selling his house at 2/3 value could have consequences further down the line
    • Tgall1
    • By Tgall1 15th Jan 20, 6:50 PM
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    Tgall1
    • #4
    • 15th Jan 20, 6:50 PM
    • #4
    • 15th Jan 20, 6:50 PM
    Father is staying in property with me ? Iím also worried about tax would dad have to pay tax on the money he gets for sale and would I have to pay a gift tax ?
    • G_M
    • By G_M 15th Jan 20, 7:09 PM
    • 51,189 Posts
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    G_M
    • #5
    • 15th Jan 20, 7:09 PM
    • #5
    • 15th Jan 20, 7:09 PM
    * you would pay SDLT on the purchase price
    * he'd have no tax to pay - though it might affect any benefits he claims

    * there's no 'gift tax'
    * if below market value then the 'gift' element would remain in his Estate if he died witin 7 years, for Inheritance tax
    * if below market value then the council would consider the gift element as 'deprivation of assets' if he applied for funding for care (eg a care home)
    * if you need a mortgage, the lender might be concerned about him living there (harder to evict him if you default) though I think you can get him to sign something. Speak to a mortgage broker.

    * but (as per the point above) he is making himself very vulnerable by selling to you - does he have other assets? Savings? Another property?
    * what if you got married? Moved in a boy/girlfriend? Would he be happy sharing? Worse, what if you got divorced and your ex took half the house? He'd be homeless....

    There are downsides for him - so what is the purpose of this arrangement? What are you, and he, trying to achieve?
    Last edited by G_M; 15-01-2020 at 7:12 PM.
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