Mumsnet Talk

Thanks Stormforce, we've found a few flat options close by to us and will think about the future as it comes.

sorry don't know how that happened.

I think its lovely that you wanted to help him especially after all the money you've already put into getting him through rehab. I think your idea was deeply flawed for lots of reasons but I don't think you were being greedy.

I do think you're right to ditch the idea though. Its unlikely to give him financial security to be honest. Sadly it would have been far more likely to land him an unsellable flat, surrounded by the very people he needs to get away from and possibly faced by huge maintenance liabilities.

I think you're a lovely sister for wanting to help him though

His life and health are worth far more than a flat!

He really needs to focus on getting away from that area entirely to further his recovery. He needs a clean break, not a tie to the place. That is the most important thing and being in recovery is the only way to ensure he does have financial security in the future.

I think its lovely that you wanted to help him especially after all the money you've already put into getting him through rehab. I think your idea was deeply flawed for lots of reasons but I don't think you were being greedy.

I do think you're right to ditch the idea though. Its unlikely to give him financial security to be honest. Sadly it would have been far more likely to land him an unsellable flat, surrounded by the very people he needs to get away from and possibly faced by huge maintenance liabilities.

I think you're a lovely sister for wanting to help him though

Thanks all, it is absolutely not mortgageable (and possibly uninsurable too) but all that is reflected in the low price. We would have been cash buyers.

We have pretty much binned the idea, although we would have liked to have helped him in this way, we will have to find something else.

He may also lose it soon anyway because it is a two-bed and he is on his own - he will be a bit gutted because he saw his right to buy as a chance at financial security.

What AP said - you could get landed with an unsellable property (no guarantee that the council would buy it back and possibly needing a cash buyer in future).

And again, it might not be able to be legally rented out for a while. To prevent people buying their council home in order to become BTLers.

You'd be very unlikely to get a mortgage in a flat in a multistorey. Not an issue for you if you're a cash buyer, but you'd have problems selling it on.

Thanks Stormforce, I hadn't considered that aspect at all. I actually had to pay 3k in my old mansion block in exactly the situation you describe. This is a massive 20 storey tower block built in the 60's. He is on the top floor, though, and has amazing views over the river, it could be a great flat if done up at bit.

I would be very very cautious about buying a council flat and not just because of the reasons outlined above.

If the freeholder decides to make a repair to e.g. the roof then the price will be divided by the number of flats in the building. Any leaseholders will then be charged the appropriate amount for that repair. This can turn out to be very .
expensive. Imagine if there was subsidence. Really and truly I would not touch a council flat leasehold with a barge pole. I've seen too many people stung really badly by these costs. On top of that there will usually be an associated managment charge. There have been some legal cases about this lately and some have been won with costs being massively reduced but this was on the basis that councils did not notify the costs properly in advance. Take a look at this article for more information

Mamababa, he has two children right near by, so he wants to stay in the area so he can build more of a relationship.

Can I just repeat, that we have no plans to sell it. He wants to live there in the future. If we rent it out, the profit would be held for him, or used to pay tuition fees/living expenses.

I only wanted advice and was very willing to take it!

But you say in your OP 'we need to get it transferred into our names' why, if it's for him?

And then you talk about him moving and you letting it out, but then say 'he doesn't want to flat swap, he just wants security where he lives now'

Not sure why you buying it from council of HA helps this. You say he needs to get away from old associations but then he wants to stay

Thanks, Lougle, for that helpful post. I'll look into that, but I would have thought that transferring ownership was the same as transferring the deeds, which would be a sale.

I'm still clueless, Lala, why you consider this fraud. Surely people help people buy houses all the time? And it would be legal to use a mortgage lender to buy the flat, wouldn't it? I have already said we would be prepared to leave it in his name. We had originally thought we could rent it out while he is elsewhere, so he could fund his studies or whatever, but if that isn't possible, and in the light of information given here it seems it isn't, then we won't do it. I really resent the meanness of people determined to cast as us grasping property developers.

Yes, that is a catch. But if the OP was interested in helping her BIL, presumably she could move her family to the flat and he move to her home for a few years while he cleaned up?

I'm not suggesting it's feasible, but it's how they would make it work.

The catch is that you usually can't lease it out straightaway.

Well, quite. But that's a decision for the OP. The answer seems to be 'possibly' but I do think there are moral and practical considerations that need to be considered above whether it is 'possible'.

yy and if you give him the money he might just fuck off with it and spend it all on drugs - very helpful

Hmmm...actually there may be a way. If you gave your DBIL the money to purchase the property, then he transferred ownership to you, he may not have to pay back the discount:

"You can apply to buy your council home if:

it’s your only or main home
it’s self-contained
you’re a secure tenant
you’ve had a public sector landlord (eg a council, housing association or NHS trust) for 5 years - it doesn’t have to be 5 years in a row"

"You can make a joint application with:

someone who shares your tenancy
up to 3 family members who’ve lived with you for the past 12 months (even if they don’t share your tenancy)"

"For flats you get a 50% discount if you’ve been a public sector tenant for 5 years. For every extra year you’ve been a public sector tenant, the discount goes up by 2%, up to a maximum of 70% – or £75,000 (whichever is lower)."

"If you sell your home within 10 years of buying it through Right to Buy, you must first offer it to either:

your old landlord
another social landlord in the area

The property should be sold at the full market price agreed between you and the landlord.

If you can’t agree, a district valuer will say how much your home is worth and set the price. You won’t have to pay for their valuation.

If the landlord doesn’t agree to buy your home within 8 weeks, you can sell it to anyone."

"If you sell your Right to Buy home within 5 years of buying it, you’ll have to pay back some or all of the discount you got.

If you sell within the first year, you’ll have to pay back all of the discount. On top of this, the amount you pay back depends on the value of your home when you sell it. So, if you got a 20% discount, you’ll have to pay back 20% of the selling price.

If you sell after the first year, the total amount you pay back reduces. You pay back:

80% of the discount in the second year
60% of the discount in the third year
40% of the discount in the fourth year
20% of the discount in the fifth year"

"*you may not have to pay back the discount if you transfer ownership of your home to a member of your family.* You will need to agree this first with your landlord and then get a solicitor to do this for you." https://www.gov.uk/right-to-buy-buying-your-council-home/help-and-advice

Then he can live in it or swap out, but it's illegal to buy it and immediately rent it out.

Giving large financial "gifts" is not without strings too.

You need to think about him being responsible for inheritance tax if the giver of the £ should unfortunately expire within (I think) 7 years

When dpil helped us with a deposit for our house it had to be structured carefully to minimize risk to us.

You can't lease it out for a while after it's been purchased.

I am with lala here. You want to buy his flat with very generous discount. For him. That's ok.

You then want to rent it out (and therefore make money) and then you or him will keep it for a number of years and then sell. For a profit lets face it.

So your intentions may be ok, but the suggestion you won't profit is ludicrous

You are defrauding because what you are doing is not legal - OK