AIBU to be really pissed off?(51 Posts)
I've started this thread in here as it's property related. It's a bit long so best with me.
Me and DP were offered, back in June time last year, some money to help us buy. DP's mum was inheriting quite a large sum of money following a death in the family.
We weren't financially in a place to get a mortgage at that time - never in debt but we knew we were using our current accounts a bit too frequently so we wanted them tidied up before we approached a lender. Anyway, fast forward to December and all our info, bank statements, payslips, DP's statements of accounts (self employed) were sent to my friend who is a financial advisor. We got a rough idea of what we would be lent and started house hunting. You might have seen from other posts that we were concentrating on East London and specifically Leyton / Leytonstone.
Most properties in our budget are flats. During our second week of searching (having already lost out by £65k on a flat) DP got a text from his brother. He told DP that he was a fucking moron to consider buying leasehold, that we were stupid for considering that part of London, that the market is about to crash anyway and generally implied we were too stupid to be trusted. He then started sending links from newspapers that suggested a crash / the end of BTL etc. Then DP's mum started saying that she wasn't sure we should have the money, we can only have it if we buy freehold etc.
Relations broke down and it ended up with us having to email his mum setting out details of the research we'd done into leaseholds, the reality of buying a house in London, why we didn't want to live in the area she is etc, that we'd set up a deed of trust post purchase so she can be sure she'll get her money back.
Despite very little communication we were given the impression the money situation was okay and we should keep looking. We've lost out on 5 flats so far and were reaching the conclusion that we are priced out of our preferred area and so were realistic and planned to start looking at different areas.
We planned to view a house that had come on - a total state but a house, freehold, we'd keep them happy. We've had a few odd messages at the weekend we were meant to view, had we seen it, did we know we would need to do a deed of trust (yes, we suggested it). Anyway, the deposit money gets transferred.
Sunday night DP gets an email from his other brother saying that everyone is uncomfortable with the amount of money being lent, where we plan to buy, what we buy blah blah. But suddenly there is mention of this bring their inheritance and we are putting it at risk, this isn't a gift. All along the same lines of you can't be trusted.
I burst into tears at this point as these emails are fucking us about so much. This isn't just a bit of interference, this is our lives. Buying will drastically reduce our outgoings which gives us the opportunity to have a baby whereas renting just doesn't.
DP's mum claims she didn't know about the email but insists its only because the brothers care about her.
I cannot involve myself in these arguments as they aren't my family but I would love to. I feel insulted, deliberately misled, that they've been dishonest from the outset if this is about money rather than anything else. I'm fuming actually.
Sorry for typos.
I should say that whilst the amount of money is large, it doesn't represent anything more than a 1/10th of what will be their potential inheritance. Notwithstanding the fact that she's very much alive and well. I have no idea why it's suddenly become about what will happen to her money when she dies. She's only 65! But the main point is that despite it first being offered as a true gift, we have assured her that we will give it back and the best way we can do that is with a deed of trust.
Is the offer of the money a loan or a gift?
It sounds like there needs to be a lot more clarity in your DP's family about the conditions that you are getting this money under and terms for repayment in order for everyone to be happy.
You'll probably be in a grey area as the mortgage company will want the money to be a gift, not a loan, as they won't want anyone else having a potential charge on the property.
We are in a similar position, having borrowed a very large sum from DP's parents to buy our flat, although his brother doesn't seem to be concerned about it. The difference is that the sum we have borrowed will equate to less than DP's inheritance in the end (so PILs have adjusted wills to take account). However, I still get nervous thinking what might happen if care home fees were to eat up all of PIL's equity - we don't have a concrete plan or agreement in place to pay back the loan yet (DP and his parents have always discussed it together and arrangements have remained vague) and this makes me highly uncomfortable.
We were buying a house last year when mil announced she'd like to give us 30k. We found a house that we needed 20k mire than original budget (10k less than mil wanted to give). We ran it past her yo make sure all was ok with the money and she then said it would be a loan not a gift.
We agreed, still grateful but feeling g a bit messed about. The day after our offer on the house was accepted and we'd just coughed up 700 odd quid on a survey she said no I don't want to lend or give you the money.
I was so pissed off and stressed out at being messed around and our hopes being risen to be taken away etc etc. So I totally get where you are coming from.
My way of coping/processing it was you can't miss what you never had. I have the feeling my bil had some input to her decision too. Mil now does not like the house we ended up buying because it's small - her words.
There was so much stress involved in those months of mil saying she was giving then lending the money that once I got over the dissapointment of losing that other house and the money we'd spent on a survey I saw it as a relief. I fear it would have been blood money anyway whether it had been a loan or a gift.
Really feel for you but be glad you're free from whatever shut that money would have tied you into.
Anyway, my advice would be that you need to sit down with DP's family and hash out something concrete. It's inappropriate for BIL to be sticking his nose into your house buying and trying to take charge (and he's generally wrong about leaseholds, unless the lease is too short) but it sounds like those boundaries won't be able to be asserted until more clarity has been made around the money.
If she does gift it to you now, it's free from inheritance tax of course....though there's nothing to stop you making regular 'gifts' to her in the future to help with living costs.
The goal posts with the money have changed. Its far less than the actual money she has to leave and realistically my DP would be looking at the same sum x4 in the end.
The lender will want to know its a gift and this is what we told them. That's when the panic seemed to set in. Since then it's gone from a gift, to a 'gift' for the purposes of the mortgage but then release equity in time.
It's impossible to keep up with the changes. As far as I'm concerned if there are going to be multiple conditions attached dictated by the brothers I want nothing to do with it.
BIL's experience of leaseholds is as it is because his GF had one in a large block so got stung for big maintenance charges but also let the lease get too short and ended up paying a lot to extend it.
We've been looking at 2 bed Victorian purpose built maisonettes, no more than 2 flats in a building some leasehold, some share of the freehold. The freeholder is a large company who own the freehold to 1000s and 1000s of buildings in London so they're not some rogue developer.
Please make sure you are careful and Don't get burnt. My mother did the same but with building work and is now suing myself and my partner for it back- she changed her mind two weeks after lending it
We also got a lend off my parents to assist us buying. The conditions were clear from day 1. We have a good open relationship with them and we are repaying as agreed. My siblings know I got a dig out from my parents but don't know the particulars. They know I'll repay and it's between my parents and me and DH.
I would run a mile if I was you. You mil is clearly concerned and talking D her other children. Buying a house is a very personal decision and having everyone sticking their noses in is worrying. I think go it alone, it may take longer but borrowing money from family can be risky and this is crying out for trouble
If it wasn't for the fact we literally have no chance of raising the money ourselves (a 5% deposit will be close to £20k) I'd have never got involved.
Poor DP is feeling really excluded and upset by the whole thing too. I wish I could step in but I can't.
I can't believe your parents are suing you! God, how awful. Money does weird things to people.
Do the brothers own property? Are they feeling left out because they aren't a position to buy?
Would it make sense for MIL to make a similar gift to other children at the same time? Would that defuse any issues around jealously? With bonus that if she's not going to die any time soon, the inheritance tax issues are removed.
The BIL is just wrong about leasehold. Freehold flats are pretty rare in England (for a reason: there needs to be an agreement on responsibility for structural and communal costs either way), and if a flat is what you can afford, that's what you have to go for. As you note, maisonettes are a different deal anyway.
Also can't see the bottom falling out of the property market in London. Even if BTL drops, there's no shortage of people looking to buy. And if BTL drops, it only makes the rental market more competitive.
Plus, you're living in it. It reduces your outgoings. It enables you to get on with your life. Its value is more than what the market says.
No they all own their own places and in decent areas. The rationale behind it to start with was he was the only 1 (of 4) who was renting and so it was important to get him on the housing ladder.
I think BIL is wrong about most things to be honest and it drives me nuts!
DP has told him mum he'll transfer the money back but she won't give him the information he needs. It's so ridiculous.
While l don't agree with BIL interfering, l saw your other thread and you were looking at spending £400,000 on a 2 bed property that needed a lot work. Do you need to be in E London? I ask because you can get cheaper houses 2 bedders that are in very good condition for much less than that in London.
We don't have to be in E. London, no. Where would you recommend? Genuine not snidey question.
The caveat to that is we do not want a massive commute and we need a garden due to pets.
Although if the money was dependent on where we live it is a condition we didn't know about or agree to. We will be the ones responsible for the mortgage which would be significantly more than the amount being lent so not sure what location has to do with it.
400k for a 2 bed leasehold in E London doesn't sound like great value for money if money is your issue. Nobody wants a long commute, but most of us cut our coats....
£400k is pretty cheap compared to the SW, SE and North. What's the relevance of location to my actual post?
I genuinely have been looking for alternative areas but whether the commute is a good enough reason or not, we are trying to keep the commute down to an hour. And that's an actual hour, not an hour subject to the trains / buses doing what they're supposed to do. DP works in Earl's Court and I'm in Bank.
Regarding my post, the relevance was that you could find cheaper in a different area.
Maybe they think you're being feckless with 'the inheritance'?
I don't think yabu to be pissed off but there is usually always some catch when taking other's money and in your case it seems that the whole family gets an opinion on where/what you buy.
If that ends up being a condition I'd personally tell them to stick their money.
Well I think that must be what they think despite not actually saying it but I think their issue will be that the areas we are looking are risky financially i.e. we'll lose the money.
They both live in SW London so the East is an unknown to them.
The relevance of location is generally that if people are financially enabling you to achieve something by lending money, they are entitled to ensure that the money will actually be paid back and not frittered away on something that will lose money. That's how loans work.
A 1 hour commute for a first time buyer is la-la land these days.
Less than £400k gets you this in Shepperton. Nice enough area, 1 more bedroom, nice garden and 1hr 15/20 commute to both EC and Bank.
I work further west and dh is also in the City. Look at places going into Victoria and London Bridge. We are zone 3 and paid half of that for our 2 bed. It was 5 years ago and now you'd be looking at £300,00 but you'd be 'saving' 100k
I think it might be important if you absolutely need the money to sit down and discuss the situation with you DP's mother. Since his brothers are so involved you could ask her if they are part of the discussions (obviously yes!). Then you could draft together a sort of contract with the conditions to the gift or loan (so they don't change constantly). Be clear about what you need and what is realistic.
IME discussion by email are the best way to have a communication fail esp. sensitive subjects.
It's only natural for them to want you to spend the money on a sensible home, wether what there fears make sense is a whole different matter.
But if you can find an other way to get the money (get the cheapest rent possible for a year or two even if it involves a crazy commute while being really strict budget wise maybe?) run.
Danger - places in zone 3 were going for £100k less last year, I highly doubt something that cost £200k five years ago costs anywhere close to £300k
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