Feeling guilty for asking/accepting money from parents

[eyesbiggerthanstomach]

I am going through a divorce and to get myself out of my pickle, there is discussion of my parents giving me money to buy ex H out of the property.

Nothing has been confirmed yet but my Dad has said he would happily do it but figures have yet to be agreed.

By way of background, my Dad gave me £75k to help with our deposit a few years ago. Soon to be ex H is a low earner self employed and contributed £15k. I contributed £12k but the mortgage was basically based on my income of around £51k.

The declaration of trust that was drawn up and that we have agreed to stick to is that ex H will get his £15k plus 50% of any profit (after you deduct the other contributions).

I'm too scared to get a valuation but it looks as though I will need around £40k for me to buy him out.

There has been financial abuse (I have posted previously) so as it stands I have some debt and am paying £1200 per month from my salary alone for nursery fees.

For that reason I can't get his name off the mortgage as the bank now won't let me take that on alone in light of my nursery fees. DS is only 2 so I have a little while longer to pay nursery fees although it will go down in 14 months time. DS lives with me full time.

Ex H won't wait for the money and my worry is if he gets legal advice he will realise the declaration of trust isn't binding as we are married and he could take a swipe at my Dad's original £75k. I am a family solicitor so I will make sure any money given is all done in the correct way to protect me but at this stage the only way out of this is for my Dad to give him the money.

My Dad isn't in a bad financial situation. He has savings and a second property and this sum will be a fraction of his savings but it's not peanuts to him and it's not money that can easily be replaced or built up again because of his age. I do, however, have 2 younger siblings. They haven't benefited yet from any help with a deposit as that is always given on condition of marriage and they are single. They are on track to be high earners over £100k (in say 5 years or so) so there is no desperate need there as such but they don't have savings as their income is about half that at the moment. I feel bad that I have had the £75k and will now have a further £40k odd effectively but I can't see how I will manage to keep the house (which is only 2 bed so I'm not excessively housed) without it.

I was thinking about my dad having an interest in my house so it's not a gift but the difficulty with that is that he has put my granddad in his will (to get a good chunk) and the last thing me, my siblings (or my mum!) would want is for my house to then be brought into the pot in the event my granddad who we don't get on with outlives my dad. That's why we would want it to be a gift.

AIBU to feel guilty in accepting this money?

Take the money in this instance to provide security for yourself and ds. Draw up some kind of affordable payment plan and make a conscious effort to repay some (if not all), this money back to your dad. Ultimately it is your dad's money and he can give it to whoever he chooses so your siblings shouldn't get pissed off about it. In reality the they may see it as your dad bailing you out for making poor life choices and worry that there won't be much left in the pot for them. Make sure you don't get back with the ex ever and move forward happily!

If I downsized and lost a bedroom - not that the OP can anyway. I’d save £30,000 - £5 of which would go in estate agents fees and £5 of which would go in stamp duty. There would then be removal costs. So say I’ve saved £18,000. My extra bedroom is let out to exchange students in the summer so in 9 years that £18,000 is saved. You really do have to factor everything in and try and minimise the distribution in your life, it’s not good for people

Also the debt. And view it as a long -term loan to be repaid to your dad when you are able. I am very much of the view that families should help each other out if they are able to. Works both ways if your dad needs help in the future.

Could you agree with your dad that he gives you the money upfront now and your siblings receive more from his will - to even things out?

Not sure if anyone has mentioned this but why don't you get your dad to pay the nursery fees for the next couple of years if that allows you to take the mortgage in your own name?

Dacquoise's suggestion is pretty good. Could this be a solution OP?

Personally, I wouldn't be able to accept the money from my DF if it meant there's a risk he wouldn't be able to help my siblings with the same generosity as he'd shown me.

Op your first priority has to be keeping a secure roof over your head.
Get your dad to pay off DH's £15 k now to be free of his financial tie on your home. Make it legally done.That is by far the most important thing.

Then get three or 4 valuations now, without discussing with ex, so you know what you are facing.

if it is the 40K you expect, either take from DF and draw up an agreement to repay set amounts monthly, increasing as you can ie when Ds goes to school.

If it is indeed 40k, you could perhaps pay say £250 per month now, (guessing what you can afford) increasing to £500 once Ds is in nursery.....This would soon start to build up a fund for you DF to put aside for other siblings if neccessary later.

As you have 2 bedrooms have you thought of sharing with DS whilst he is small and getting a lodger for some tax free income , you could pay DF back much faster with an extra 6k ish a year.

Don't sell as you will lose on fees, stamp duty, legal and mortgage fees and possibly capital gains tax too.
Don't move as you will be risking your job security.

As long as you can afford to live and run your current house, once you have sorted the above, stay put, and focus on career progression and other sources of possible income.

The last think your father wants it for you to lose your home. Let him help you out here.

Could you get your Dad on the mortgage if you were tenants in common in the house? So that on his death it reverts solely to you and doesn't go into the "pot"?

Then you could potentially buy him out over the years, or come to some financial arrangement where you create a trust for your kids (or the grandchildren of the family collectively) and your father is bought out when it hits 40k? (because there's no point you giving the money back to him in cash to pay inheritance tax on, if he doesn't actually need it)

There are loads of ways of doing it, but with a wealthy-ish father, two high earning siblings and a sibling who has been financially abused by a bastard husband, is getting out and faces losing her home, they would surely be inclined to help you as much as possible.

Just one question - is this 2 bedroom property in a fancy part of London? Is moving sideways to a less affluent postcode to release the capital possible?

Not sure if anyone has mentioned this but why don't you get your dad to pay the nursery fees for the next couple of years if that allows you to take the mortgage in your own name?

I didn't see this before posting - that's a really good idea.

@Dacquoise

Thank you.That is a brilliant suggestion I never thought of that.

That is much less than the £40k and would get the ex off the mortgage provided a lender would let me not only take the existing mortgage on but add a £40k to buy out the ex.

I am in a fixed term so I will have to get advice about seeing if my existing lender could do it without incurring the £5k redemption but I will speak to my lender about this,

If you were my child I would want to help. You live in an expensive area, your nursery costs are fixed. It sounds like your Dad has plenty money so that your siblings wouldn’t suffer. You could get him to change his will to reduce your part of the inheritance when he does die.
I’ve read your other thread and this seems the best way to get rid of your husband as quickly as possible with minimal disruption to your children’s lives.

You're a family solicitor but you entered into a financial agreement that wasn't legal ?

Informal loan from dad, agree a payment plan with him to start once debt is paid off and nursery fees reduce, that way he will have the money to give to one of your siblings in the future to match the 75k he has already given you.

My pleasure @eyesbiggerthanstomach, I was able to take on my mortgage using a broker and it was based partly on spousal maintenance. I changed lenders from the one with my ex husband and ended up with a much better rate, lower repayments and that included a redemption fee. I believe you can get a free quote for L&C.

@4amWitchingHour, that's exactly what I was going to suggest.

OP, you won't be paying £1,200 a month for very long, and should be in a position to remortgage in a few years, then you'll be able to pay your DF back. And he sounds lovely, to help you out like this.

@Dacquoise genius

I was just coming on to suggest that your dad takes on the nursery fees instead, but see someone else beat me go it! That jumped out to me as a way to ensure you stay in the house, have the mortgage yet your siblings can't feel too hard done by as (presumably) they don't have childen yet. You could also pay him back in the future and he (grandad) has no claim over part of the house.

I'm in the SE too so can see how nursery and housing costs are so high. But it's still so depressing that a solicitor earning £51k can't afford a two bed house. No hope for me then!!

Very good point dacquoise and hope OP is able to use that idea to make herself more eligible on the mortgage application.

We had a similar situation with DD and her work-shy ex. We paid a lump sum just to get rid of him. It wasn't as much as you, but the divorce would have been a long expensive process if we hadn't been able to step in. Peace of mind is really important, and I'm sure your DF is having some sleepless nights at the moment.

Dad Paying the nursery fees is a brilliant idea!!

You need it now.
Take it.

Do all you can to do right by your dad and siblings later.

No way I would want my sister and her small child to suffer unnecessarily.

Good luck.

Your mortgage lender may be willing to transfer the existing fixed term mortgage to your name only and then extend you a separate additional mortgage (often called a homeowner loan) for the £40k you need. You will probably need proof that your dad has agreed to fund the nursery fees for the rest of the fixed term at least...

The declaration of trust ... is that ex H will get his £15k plus 50% of any profit (after you deduct the other contributions)

Does this mean that at least your dad's original £75k is safe from being shared with exH?. If so at least that's something, but one way and another he seems to have done you over completely - and the "self employment" thing means you can almost certainly forget any child maintenance

Under the circumstances I'd be very unhappy about taking any more from your DF; would it be possible for you to rent instead of buy now?

Lots to this but the one point that jumped out at me - so your grandad is a beneficiary of your dad's will - is that likely to actually happen? I mean, unexpected things can happen but unless your dad has major health problems, surely you would expect him to outlive his own father, so that would not be an issue?

There are 5 children in our family and my parents have often helped or bailed out my sister who is a single mother and I suspect my brother who is a low earner. I don't have any resentment - in fact the opposite - my parents have always been so giving and generous I am so proud of them. I know if I has similar issues they would step in for me.
Your dad is offering - take the money. You need it for your son.

It depends on whether he will struggle without it or not.

If it’s money you would inherit anyway, makes perfect sense to give it to you now when you need it. It’s also great tax planning.

Some on here are really weird about asking parents for money. Mine have helped all of us out in the past and will do again if we need it, but they would never do so if it meant they were struggling.

Looks like asking you Dad to cover the nursery fees is the way forward. If you are 2 hours away from family and are going it alone please start looking into childcare options for when your son starts school.

Wrap around care is not cheap and then there is the 13 weeks of school holiday to cover. Maybe your parents will be happy to continue to cover this cost.