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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

In thinking this is a win win situation? Am I missing something?

226 replies

Arghhhhhhhelpjobinterview · 13/01/2018 23:07

I am not financially savvy nor is my aunt.

Due to funny family ages I have an aunt who is only year older than me. Not really relevant..

I have inherited a small flat, which needs new bathroom and kitchen and general over haul. Ie new plaster etc. However it's got new heating boiler, very warm, good windows Grin

It's too much for me to do up, and it's far to far away, that's not an option at all for.
.me.

My aunt has very tight finances and is desperate for some where to live. She has thought about buying my flat outright which would leave her with no budget to do up the flat.. She would have to get loan off her df or he pays out right for bits and pieces. But she would own flat (long lease).

Or.. I have offered if she pays for the bathroom to be done, she lives there rent free for cost of bathroom plus extra months as a thank you... And so on. Meaning she keeps bulk of capital, to invest... She gets my flat to live in...

And we get something in place legally to say... For every x she invests.. She gets x amount of months rent free. I also get something to protect me.

She gets sanctuary, plus her capital.. I get my flat looked after, council tax and bills paid and slowly done up.. By her but also me.
Looking at this as a ten year project?

Any spokes I'm missing?

OP posts:
Original poster
Arghhhhhhhelpjobinterview · 14/01/2018 09:32

Re aunt paying rent.. It's quite low down on my priority at the moment because her being in it buys more time for me to get up to speed with all sorts of things, I'm paying 109 a month on it in council tax alone Shock.. She however would only have to 75 a month as single person.

She would buy me time to get myself sorted work worse, youngest dc literally just started school.. And manoeuvre myself into a stronger position financially..

She had help with her mortgage.

OP posts:
peachgreen · 14/01/2018 09:33

If the toilet is falling through the floor it sounds like it's going to end up being a money pit. Nightmare. I'd cut your losses and sell now.

InspMorse · 14/01/2018 09:34

I don't understand why she has an interest in your inheritance at all OP.
You seem to be considering her wants needs more than your own.

YOU have inherited the flat. It is YOUR inheritance not hers.

I think she is trying to muscle in on it in a very canny way. She's making out it's for your benefit too but tbh, what do you gain other than hassle?
She has money to spend, she needs to spend it on living expenses. Her own.

This is the only inheritance I am going to get, and my own situation isn't great.
I would SELL.
Use the money to help your own situation and think about yourself.
Maybe her Dad has realised that she's offloading and has backed off?

InspMorse · 14/01/2018 09:36

FREELOADING not offloading!

Sewfrickinamazeballs · 14/01/2018 09:37

However you word it, you will still be a landlord and she will be your tenant, so all the usual requirements of that relationship apply.

I would not do this. Who would own the bathroom/kitchen once complete?

Original poster
Arghhhhhhhelpjobinterview · 14/01/2018 09:41

Insp I do appreciate every view point but she isn't like that at all, she is as far removed from cunning person you could get m. I said to her as she a joke really ages ago... Would she like the flat, as a joke but she said yes! Many times I have said are you sure you want it..

I don't know if this sounds awful but another way around this maybe to sell the flat at slightly less than market value to her...

Absolves me of all problems with it, frees up money for her but ask her to leave that share to me or my daughters in her will! Does that sound mad I wonder.. Then much later down line my daughters at least would get something back?

OP posts:
ImNotWhoYouThinkIAmOhNo · 14/01/2018 09:44

If you are still thinking of renting to her in any form, get yourself over to the Landlord Zone website and read the forums before deciding if it's for you.

Original poster
Arghhhhhhhelpjobinterview · 14/01/2018 09:44

She has had very tough time recently with major illness, everyone knows this so not freeloading just awful bad luck.
At home she also does an extraordinary amount for her dp, both fit and well, but she does most of the cooking, cleaning etc... Running around.. Which is why she is desperate to get out Grin

I have swung back to selling it to her outright.

OP posts:
hidinginthenightgarden · 14/01/2018 09:47

What about you take out a lone for the work, she over seas it and can live in it paying back the loan, bills and council tax? You said it is a ten year plan so if you need a 10k loan it would be very small repayments, even if you took it out over 5 years.

InspMorse · 14/01/2018 09:47

You seem to be dead set on helping her even though you are not in a great financial position yourself.
You could definitely sell it to her at reduced price but could she gets mortgage?

WasWildatHeart · 14/01/2018 09:50

Not read whole thread so apols if this has been said already but I recall there is an option to lease out a property, rather than let it. This is common for businesses but can also be done for houses. The tenant gets the surety of living there for a long period of time and can invest in their home in line with the expectations about looking after the property. Housing associations sometimes lease properties from private landlords and do them up too. You’d need good legal advice from an expert.

InspMorse · 14/01/2018 09:52

I understand that she is in a difficult situation but I still don't understand this...
if she has money to do up your flat, why can't that money be used on private rent?
Why is your flat her only way out?

Didiusfalco · 14/01/2018 09:52

I think she would be mad to throw a load of money at your flat. It’s like paying all your rent up front - why would you? If her circumstances change and she needs to leave for work etc she could be out of pocket. If she is as naive financially as you say then I think she needs protecting from this just as much as you do.

Also, the idea about the wills is a massive no. You would have absolutely no control over this and it could be changed at any point or challenged after her death.

FloraPostIt · 14/01/2018 09:54

If you came to me with this suggestion, I would probably advise that you sell her a share in the property, say 20% or whatever she can afford, so that you own it jointly. You would need to have an agreement drawn up dealing with how much of the capital you each own if the property is sold and whether contributions to doing up the house affect the shares and whether rent is payable by the occupier. This is a much more conventional arrangement. She could also buy more from you if finances permit later on, although you would need to be mindful of capital gains tax. As with every joint ownership arrangement there is a risk of things going sour if you fall out, but you could then sell the property and split the proceeds according to your agreement.

Original poster
Arghhhhhhhelpjobinterview · 14/01/2018 09:57

I don't think joint owner is good ideas I will look more into it but not sure that would work.
I have asked her repeatedly is she sure she wants it i have even asked her good friend if she is sure...

She would be able in theory to buy my flat out right with profit from her sale. So no need for mortgage.

OP posts:
IWouldLikeToKnow · 14/01/2018 10:06

Haven't read all the thread but it does seem like a win win. You're getting the flat done up to a sellable standard and you'll be getting rent for other months. Your aunt gets somewhere to live. It rent you do receive is extra money as you didn't have a rental income from it previously. And you'll get to sell it on on the future.

SavoyCabbage · 14/01/2018 10:06

It doesn't make any sense for her to do it. She's putting herself in a vulnerable position. She's already got an unstable job and she's going to have an unstable living arrangement if she's not careful!

YesItsMeIDontCare · 14/01/2018 10:09

I have actually done this. Find a good solicitor to draw up a legal agreement and you should be fine. PM me if you want to.

InspMorse · 14/01/2018 10:09

She would be able in theory to buy my flat out right with profit from her sale. So no need for mortgage.

Then she doesn't need your financial help.
Don't get into a messy situation if you don't have to.
Looks like she's keeping her options open (keeping her money free) yet narrowing yours ((keeping yours tied up in the flat).

Sell the flat and leave her to buy something with her money.

It will be interesting to see if she chooses to buy your flat with her money...

marzipancustard · 14/01/2018 10:11

As a former property solicitor I really really would advise against anything other than an outright sale. If you don't have a few thousand pounds spare in case of maintenance emergencies then holding onto ownership in any form whether as landlord or otherwise is a bad idea.

Being a landlord isn't cost neutral. www.propertyinvestmentproject.co.uk/blog/financial-costs-of-being-a-landlord/
This gives you an idea of possible costs.

And however close you might be to your Aunt, there's something about these situations that brings out the worst in people. Unless you are happy to lose the value of the asset I would steer clear of any random dealings with family.

Original poster
Arghhhhhhhelpjobinterview · 14/01/2018 10:17

Sorry one more important point I forgot to mention is that she will make flat two bedroom so she can rent room out to help her with everything should she need it, obviously after essentials done

OP posts:
SimonBridges · 14/01/2018 10:20

It does sound like the flat is potentially unmortgagable.
I can see how this makes it something of a mill stone around your neck.

I think this option should be approached with extreme caution.
Personally I think you should sell but that depends on if you can sell. Some people seem to forget that there are some areas of the country where a flat like that could stand unsold for years.

CaptainMarvelDanvers · 14/01/2018 10:21

You keep saying she isn’t paying rent but she is as you’re saying the repairs she would be doing would be covering her rent.

So what would happen if she moves in, does up your flat which you can’t afford to do at the moment, then you decide to kick her out as the value of the property has risen.

I don’t understand what’s in it for her. If she buys it outright, sure she might have to take out a loan to do the bathroom but it’s still her property and investment.

I think your Aunt should run away from this deal screaming. This isn’t win win for both of you.

SimonBridges · 14/01/2018 10:21

Step away from the sub letting idea.

Turn it into a two bed and then get a new agreement.
Do not let her manage the sub let.

InspMorse · 14/01/2018 10:31

Sorry one more important point I forgot to mention is that she will make flat two bedroom so she can rent room out to help her with everything should she need it, obviously after essentials done

Wow... whose flat is this?
She would sublet to help with what? The cost of renovations or future rent to you?

Somehow, she has convinced you that she is in dire need (despite having enough money in her bank to buy a flat outright).
She sounds like a CF if you ask me. She might not appear to be on the surface ... Please don't get involved.