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Help with family house purchase

Looby

Well-Known Member
So my MIL is buying a new house. In the process it’s emerged that something (I don’t understand what) was not done when my FIL died which means that my husband and his siblings own 50% of the current property.
It was agreed that they would sign this over to MIL but now that has changed and Mr Looby has today received an email from the solicitor about the purchase and they as executors will jointly own the new property with their mum.
This doesn’t feel right to me for several reasons but I don’t know if I’m being thick or too doom and gloom.

1.What if one of the siblings was in debt and creditors discovered this interest in the property and pursued court action for a charge on the property? Two siblings are skint and one bad with money, this is not impossible.
2. One of the siblings is a HA tenant, is there any issue with them having a share of this property?
3. One of the siblings doesn’t own a house yet but would like to in the future. How will this affect that? I’m assuming not at all as there’s no mortgage.
4. what if one of the siblings became homeless and needed housing? Technically they own part of a house.
5. What if one of the siblings was ill or injured and needed social care?
There’s a lot that hasn’t been explained and there might be more pitfalls I haven’t even catastrophised about yet. 😄

Can anyone help at all?
We’re waiting for some advice from the solicitor but there has to be another way to do this surely?
 

baldrick

ooooh timewarp
Sounds like your parents in law owned the property as tenants in common and when your father in law died his property was directed according to the will to his children? Presumably there were reasons for that rather than leaving it to his wife. Did the will say or did he not realise that it wasn't jointly owned?

It does sound potentially very messy. Hopefully the solicitor can furnish you with why things have ended up here and how best to proceed.
 

Looby

Well-Known Member
That sounds about right and this might have been what my FIL wanted but his children didn’t know. There was no will reading as everything was going to MIL. Or so we thought!
 

marty21

One on one? You're crazy.
The HA tenant presumably got their flat before getting a share of the house, so having it now doesn't affect their tenancy - but could affect their HB/UC if they are entitled to that - as I think it could be considered as capital and if it is worth over £16k I think. It probably have an impact if they apply for a transfer or to buy their property.

It might impact a sibling if they became homeless and applied for a flat - if they declare their interest - they might be rejected as homeless. If they don't declare it - and are re-housed, if it is subsequently discovered that they had an interest in a property - they could be evicted for lying on their housing application.
 

Looby

Well-Known Member
Thanks marty21 that’s a good point about a transfer and whilst the sibling in a HA property doesn’t claim anything at the moment, they might need to in the future.

The worry is that if a solution is not quick and easy and they don’t agree to the purchase as it is MIL will lose her buyer and her new house when they’re all ready to go.

What a mess. 😞
 

mauvais

change has become unavoidable
Warning - I AM NOT A LAWYER.

So my MIL is buying a new house. In the process it’s emerged that something (I don’t understand what) was not done when my FIL died which means that my husband and his siblings own 50% of the current property.
It was agreed that they would sign this over to MIL but now that has changed and Mr Looby has today received an email from the solicitor about the purchase and they as executors will jointly own the new property with their mum.
I don't understand this, can you explain it any better, particularly the today bit?

1.What if one of the siblings was in debt and creditors discovered this interest in the property and pursued court action for a charge on the property? Two siblings are skint and one bad with money, this is not impossible.
I think it would have to be debt secured against the property, rather than unsecured personal debt.

3. One of the siblings doesn’t own a house yet but would like to in the future. How will this affect that? I’m assuming not at all as there’s no mortgage.
There are various exemptions and benefits for people who have never owned property before, like not having to pay stamp duty up to a certain level. I think that could be worth up to £5k. They may also not be eligible for some help-to-buy measures. I suppose it may depend if they ever had their interest in the property properly declared, i.e. with the Land Registry.

The rest of it I can't really suggest anything on because I don't understand what's happened especially with your family.
 

Looby

Well-Known Member
Warning - I AM NOT A LAWYER.

I don't understand this, can you explain it any better, particularly the today bit?

I think it would have to be debt secured against the property, rather than unsecured personal debt.

There are various exemptions and benefits for people who have never owned property before, like not having to pay stamp duty up to a certain level. I think that could be worth up to £5k. They may also not be eligible for some help-to-buy measures. I suppose it may depend if they ever had their interest in the property properly declared, i.e. with the Land Registry.

The rest of it I can't really suggest anything on because I don't understand what's happened especially with your family.
An email arrived today with contract of sale etc attached for all parties to sign and send back. Up until this point my husband was unaware he was buying a house with his mother.

Regarding debts, I used to work for a govt department and we used to apply for charging orders on unsecured debt. It’s not unusual. Most creditors wouldn’t bother but they could after obtaining a CCJ.

I know it’s unusual for married couples to be tenants in common on a joint property purchase but I suspect my FIL might have done this deliberately to protect his share but never actually told the children what this could mean for them. It may have been explained to MIL and she didn’t understand what it meant. So far, I think I’m the only one that has raised any concerns about this at all.
They’re all lovely people but most of them haven’t got much of a clue about money etc

I know a little from previous jobs and immediately felt uneasy about what’s being asked of the siblings.

For complicated reasons I won’t explain on here, the siblings will actually own more of the new property jointly than their mum as all of their father’s share will be used and only some of hers.
 

hammerntongues

Well-Known Member
The usual reason to have done this is to protect you MIL being forced to sell the house in the event that she has to go into a costly care home . If she is the sole owner she can be forced to sell whereas if it is 50% owned by what is in effect a trust then she cannot . My guess is that your FIL knew this and was protecting the beneficiaries .

assumption only and could be wrong .
 

kebabking

Not a Girly Swot, but I like them....
i would suggest that the siblings get themselves a 30 minute (usually free) consultation with a solicitor toot-fucking-sweet.

whatever the reasons for doing it, its a fucking mess - and could get a great deal worse. what happens if one of the siblings wants to sell because they need the money?
 

SheilaNaGig

Struggling and striving
Enforced Holiday
How come the house sale has progressed this far without thee siblings being involved?

If they're joint owners, then their name must be on the deeds?

So the estate agent will not have been able to take the property to market without their signatures. The rules and regs around this are really strict, to guard against money laundering and fraud.
 

SheilaNaGig

Struggling and striving
Enforced Holiday
Is your mother in law the mother of the siblings?

I mean, is she the step mother or the blood mother.
 

Looby

Well-Known Member
Is your mother in law the mother of the siblings?

I mean, is she the step mother or the blood mother.
She’s the mother of all siblings and there’s no rift or disagreements which have led to this.

I believe FIL is still on the deeds which is where the issues started. I have no idea how this has all happened. I wish I did.
 

kebabking

Not a Girly Swot, but I like them....
That crossed my mind too. Either the other owners would need to buy them out of their share, or presumably sell the property. I've no idea about property though, so this might be wrong.
Yeah, only half a dozen lawyers and a very expensive court case could tell you what would happen in that event - the short, cheap version however is that it would be an unholy, divisive, painful mess that the family would be unlikely to recover from...

Personally, I wouldn't touch the thing with 90ft bargepole - it's got nightmare written all over it.
 

Looby

Well-Known Member
Yeah, only half a dozen lawyers and a very expensive court case could tell you what would happen in that event - the short, cheap version however is that it would be an unholy, divisive, painful mess that the family would be unlikely to recover from...

Personally, I wouldn't touch the thing with 90ft bargepole - it's got nightmare written all over it.
I agree but the pressure will be on to find a solution very quickly. They’re about to exchange!
 

SheilaNaGig

Struggling and striving
Enforced Holiday
She’s the mother of all siblings and there’s no rift or disagreements which have led to this.

I believe FIL is still on the deeds which is where the issues started. I have no idea how this has all happened. I wish I did.

So probate has not been completed...?

This does sound ever so muddled up Looby .

Would it be an idea too go back and speak to whoever handled probate?
 

clicker

nanook rubs it....
The usual reason to have done this is to protect you MIL being forced to sell the house in the event that she has to go into a costly care home . If she is the sole owner she can be forced to sell whereas if it is 50% owned by what is in effect a trust then she cannot . My guess is that your FIL knew this and was protecting the beneficiaries .

assumption only and could be wrong .
This was my thought. That FIL was trying to safeguard the property for the siblings, in the event of care home fees ever being due.
Possibly a decision made with best intentions, but so many i's to dot and t's to cross to make it even half way workable .
 

Winot

I wholeheartedley agree with your viewpoint
I agree but the pressure will be on to find a solution very quickly. They’re about to exchange!
Your husband needs independent legal advice i.e. from a different solicitor to the one presently involved. He shouldn’t sign anything before receiving that advice.

In fact I’m astonished that the present solicitor hadn’t pointed this out.

I agree with those above that this sounds like a potential clusterfuck.
 

kebabking

Not a Girly Swot, but I like them....
I thought that nothing could be done with the assets of an estate until probate has been completed. This is all very odd.
I know it sounds odd, but we bought our current house during the probate process - obviously we could only exchange contracts and take possession once probate had been granted to the executors/beneficiaries - but it went up for sale, we made an offer, and it was accepted a good month or so before probate was granted.

And yes, I did think it was dodgy as fuck....
 

Looby

Well-Known Member
Thanks everyone. I feel better than I’m not alone in thinking this is odd.

I don’t know what happened with probate, it was 10 years ago and I don't remember any conversations about the house. It’s the same solicitors so they should be able to give some answers.

I think people are right about why his dad did this and possibly also so his mum couldn’t make any ‘unwise’ decisions about the house.
It really has left them in a difficult position though. I don’t know what the siblings think. I don’t believe for a minute that any of them would try and get any money from the house but I guess no-one knows what could happen in the future.
It’s selfish but I don’t want us to be shafted by this.
 

bellaozzydog

rolling turds in glitter
A single point on timescales
I’ve just Been party to a very simple family transfer of property deeds between two joint owners. One owner transferred 50% ownership to other no friction

Flash to bang it took the solicitor 8 months

Seemed inordinately long
 

friedaweed

Climbing up the aerial
I know it sounds odd, but we bought our current house during the probate process - obviously we could only exchange contracts and take possession once probate had been granted to the executors/beneficiaries - but it went up for sale, we made an offer, and it was accepted a good month or so before probate was granted.

And yes, I did think it was dodgy as fuck....
Probate takes fucking donks currently. We've been waiting since August for it to clear on our new gaff.

Anyway yeah this all sounds a bit meh!. :hmm: Need to get to the bottom of why your hubs is on the new house Looby but I suspect it's some sort of power of attorney arrangement to future proof inheritance. This should of all be conveyed and sorted by your MIL prior to arrangements though.
 

friedaweed

Climbing up the aerial
A single point on timescales
I’ve just Been party to a very simple family transfer of property deeds between two joint owners. One owner transferred 50% ownership to other no friction

Flash to bang it took the solicitor 8 months

Seemed inordinately long
Mine took 6 and cost me £600 to give up my share and then I was told I may be taxed on the gifting my half :hmm: Money for old rope innit?
 
Just to also add with it being tenants in common and siblings having a share of ownership, if they try and buy a home for themselves they won't be first time buyers so stamp duty issues, if siblings on the mum's mortgage might not be able to get a residential mortgage and would pay even more stamp duty again as 3% second home surcharge
 

not-bono-ever

They are ringing the bells now but soon...
not going to add my thoughts on this but IME, when you start looking at tenants in common arangements, its a nightmare to unravel. also the avoiding IHT aspect just adds to the issue. good luck
 

kebabking

Not a Girly Swot, but I like them....
The Stamp Duty thing is a real thing to consider - by owning just 1% of the mum's house, all of the children/siblings will pay a great deal more SD when they buy a house for them to live in: as a 'normal' buyer who only owns one house at a time, the stamp duty you'd pay on a £220,000 property (in England) is £1,900. If you own a slice of the mum's house, and then buy a £220,000 house for you and your family to live in the SD is £8,500.

It may also effect what mortgages/rates you get, what ISA's you can get, things like Help to Buy...

Its a proper dogs breakfast.
 

StoneRoad

heckling from the back!
Rather late to this but not only should you get legal advice, I would also suggest seeking advice from an independent financial advisor (and especially one who is not solely a mortgage broker).
 

Looby

Well-Known Member
I’ve got a friend who is an IFA so I’ve messaged him and he’s basically agreed it’s very odd. I’ll keep in touch with him as things progress.

The solicitors have been fairly unhelpful so far but the family have asked for an urgent meeting to find out what’s going on as the will completely contradicts what they’re being told now.
They are now insisting the dad’s share is in trust and the children won’t own a share despite sending contracts of sale through with an email stating they will own a share and they’ll tell them the % soon. I think they just want the family to shut up, sign and go away.

One of the siblings (the one least likely to be affected) signed immediately despite them not even spelling their name correctly on the papers and the other would have done if they’d had printer ink. They now realise the implications of this. I feel awful because I’m the one who has pointed out what a fucking car crash this is and I’ve made Mr Looby promise he won’t tell them. 😄

I hate being the one that pisses on everyone’s chips and would really like someone else to actually read stuff and think critically rather than floating through this shit. It’s annoying. I don’t like responsibility and adulthood and this feels very grown up.
 
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