Inheritance issues causing a massive tension in the family.

[ThornAmongstRoses]

My DH and his sister have no relationship with each other. It’s not that they actively dislike each other, it’s more that there’s just nothing there, just total indifference. They may see each other yearly at a family get together or something but there’s no contact in between those times, not even a text message here and there.

My FIL lives relatively close to us so is very involved in our lives (no problem at all, he’s a lovely man) and since he lost his wife (DH’s mum) just over 4 years ago we’ve taken him even more into our fold to ensure he doesn’t get lonely.

We live near the Midlands and DH’s sister and family live near Skegness. His sister comes down about once a year to see her dad and will stay for about a week with her partner and their children. FIL doesn’t go and stay with them though as with their two young children, and the fact the house is quite small, there’s isn’t really any room to accommodate FIL for any period of time.

Anyway, FIL has always said that when he passes away he would want his property sold and split 50:50 between DH and SIL.

However, last week he dropped a bombshell that he’s sold his house and is moving up to Skegness and will be having a Granny Annexe type Cabin built in SIL’s garden for him to live in.

We have seen the brochure for the Cabins and they are beautiful and cost about £100k to £130k depending on size and style.

We asked how on earth he would fit one in SIL’s garden as they only have a small garden and FIL told us that SIL is going to sell her house, and then he (FIL) is going to give SIL £90k from the sale of his own house and his contribution will allow for a mortgage big enough to her to buy a larger house with a big enough garden for his Cabin to be built in.

FIL’s house has already been sold for £250k and has said he will give £25k to my DH. The remainder will be used to give £90k to SIL (so she can buy a bigger house) and then the cost of building the Cabin.

SIL is waiting to start a new job which will enable them to pay the increased mortgage payments on whichever house they buy, compared to the payments they have for their current house.

My DH is quite upset as not only is SIL being given £90k, she will then also have a much larger house to show for it, and after FIL’s passing, a nice £120k accommodation in the back garden which will no doubt add a lot of value to her property.

DH is more upset as the 50% inheritance that was earmarked for him was mainly going to be for our children as we were going to put it into a university fund for them to use when they’re older.

FIL has also asked if he can come and live with us whilst everything “at the other end” gets sorted, which we have already said yes to.

FIL has got to leave his house at the end of April and has told us he’ll probably only be with us for a few months, but SIL hasn’t even started looking for a house yet, never mind the two months it takes to build the Cabin when the house has been bought.

It’s all such a mess.

There’s underlying tension brewing and I’m worried it’s going to cause a huge fracture in DH’s and FIL’s relationship and also that DH’s and SIL’s relationship will go from one of apathy to one of rivalry.

Are inheritance discrepancies a typical cause of family feuds? Is DH right to be feeling a bit irked by it?

Rather than the £125k that was supposed to be his fair share, he’s now getting £25k out of the whole £250k and everything else, in effect, is going to SIL.

This has disaster and deprivation of assets written all over it.

Your FIL shouldn't be selling his house for less than it's worth and he needs financial advice from someone specialising in retirement planning, social care the works.

Perhaps DH just needs to tell him it's all going too fast and there are massive legal problems with what they are proposing.

Why can't he just buy his own 1 bed place in Skegness for now. A log cabin will be cold in the winter etc.

Will FIL be contributing to your household costs in the meantime and giving up room for him only fair. But eek - yes his business to sell house but it feel like there was secret meetings between FIL and daughter/SIL discussing his future without Son/Brother' knowledge. Why left out?

We won’t be charging FIL to live here. He later said he was originally going to rent locally to us until he could get to Skegness but after realising how much it would cost he then asked if we’d mind putting him up “for a few months”.

I think DH was left out of it because FIL knew he’d be upset or question what on earth he was thinking of.

Me and DH just feel reluctant to talk to him about it all because we don’t want to upset him.

You just ask if he's thought of avoid delay and hassle of waiting for a build buy renting or buying.

Friend of family went from allotment to renting part of a family members garden giving up their long term allotment -it went predicatbly wrong very fast.

They wished they hadn't gone along with it but said everyone was so positive about scheme and noone pointed out any potentail pitfalls so they doubted their own concerns as when they voiced them they were dismissed.They don't do any gardening now.

If you don't say anything or ask any questions you could end up with a really long term house guest and a deterioration in realtionship anyway and if it does go pear shaped maybe the blame as well.

Wow.

He could end up in a nursing home and there being no inheritance left. Him moving in with your SIL makes that less likely to happen. So maybe SIL is actually saving your inheritance?

Years ago my elderly dad became chronically ill and was in hospital for months. I spoke to my brother about my dad moving in with me but said I would need a “granny annexe” extension to accommodate him. Dad could have funded thjs but I was aware when he died I’d be left with a more valuable house.

My brother said he didn’t care and if any money left he would still want to split it 50/50. He would be bothered I’d had “extra”. Because in his eyes that would be compensation for looking after dad when he needed it.

Your FIL could need a lot of support from your SiL, like actual nursing care. Guess you could always offer to have the cabin built in your garden and you could do all the nursing care if he needs it?

Putting aside the issue of who gets what inheritance, this seems really badly thought through.

You say he doesn't get on with SILs partner - why an earth would anyone want to live in the garden of someone who they dont get along with? What if it doesn't work out and hes miserable, he cant exactly just sell the cabin like he would a house if it belongs to SIL. I think you need to sit down with him and have a proper conversation voicing your concerns that this might not be best for him.

Hes only 65 - he could 25 years or more left. What if SIL needs to move? What if he does need to go into a care home and he has no assets to fund it? LA homes can be grotty.

I'm sure he could find somewhere perfectly lovely to live nearby to SIL that wouldnt come with all these potential problems.

With care fees a local authority can go back as many years as they like, if they think someone has deliberately deprived themselves of assets to avoid paying for care.
People seem to think there's a seven year rule, that does not apply, that's to do with inheritance tax.

If you have to pay care fees, because you have savings or an asset such as a house, then you're in a better position. You then get to choose your own care, so could potentially have private carers coming to your own house, or find a very pleasant nursing home.

What DFIL and SIL plan on doing is perfectly legal but not without pitfalls. A period of 7 years needs to pass for the gift element and also before FIL would need to cover his own care home costs.
However, larger properties require more upkeep and maintenance and all utilities are higher. Will SIL earn enough to cover the increase in costs and mortgage.
Personally I wouldn’t let FIL stay with you whilst all this is ongoing. You would be getting a using.

YABU. It's his money and he's only 65, it's very distasteful of you to even be thinking about 'your inheritance' whether FIL has mentioned it or not.

His wife died and he wants to get away to Skegness, who can blame him?

Since you agreed to allow your FIL to live with you while he was in between houses, the goalposts have moved considerably. You thought it was for a few weeks while he was between houses ; however, it could take years to go through the rigmarole of SIL getting a mortgage, finding a house, getting planning permission etc. And you don’t actually have a spare room.

You and your DH could frame a suggestion that FIL goes to live with SIL now, so that he is on hand to contribute to all the decisions being made about his money. After all, he’s spending 225k, he needs to view suitable houses/ gardens, be on hand to deal with planning officers etc. Don’t mention inheritance, that’s a red herring. Your FIL needs to live with SIL now to understand how his plans will pan out.

Have they considered planning permission aspects?

Buying a house with planning permission for a lodge like that will be very expensive, or waiting for planning will be lengthy and not guaranteed.

Inertia brilliant idea

You both need to sit down with FIL and go through all the legal implications but don't mention the fact that it's potentially unfair to your DH

Um. No they don’t. There is no suggestion from the op this man is not mentally capable of making his own decisions. Do you have kids? Do you feel that before you make any big decisions you can’t be trusted and your kids needs to sit you down and go through the legal implications? At what age do you think your children should take control like this and you loose responsibility?

I’m fifty two, I don’t need my daughter to sit down and go through the legal implications of decisions I make unless I specifically ask her to, because I have my marbles. I would suggest this man is the same in the absence of further information from the op.

Bless him, he is old and scared and wants to be near his daughter who he clearly thinks will care for him best. It seems a little callous to be already counting what he is worth and converting it into an inheritance for your children. He might still give it all to the cats home! I think you need some better financial planning in your own life and leave him to live his.

Well I think decisions that impact the family should be discussed by family. A lot of heartache could be avoided. Two heads are better than one.

When FIL talks about this plan sometimes I get the impression he knows it’s a disaster but he’s too scared to back out and so puts on a front about how wonderful it’s going to be.

Inheritance issues aside, as others have said your father in law is making himself vulnerable by investing in a property in which he has no legal co ownership. His daughter could kick him out at any time, or the son in law could divorce the daughter and seek 50/50 split of all assets including the house bought with your father in law’s investment.

Urge him to seek legal advice. There are many possible legal solutions to acknowledge his financial contribution that would not prejudice a mortgage application.

For example he could register a charge in his favour against the property to the value of his investment. Mortgage companies will be ok with that provided their charge has priority. If the house is sold or in the event of divorce your father’s investment is ring fenced and goes back to him, provided there are sufficient funds to clear the mortgage.

Has anyone mentioned she might not get planning for a log cabin ? What would happen then if he's already given her the 90k?

Presumably he will not buy the cabin until the new house is bought and planning permission is obtained

I'd wondered about this. I could be wrong, but it sounds as if FIL's expected to give the money for the cabin upfront, and if so that would be very unwise

Another point I'm not clear on is whose name is on SIL/partner's own house? Bad enough if it's in joint names, but if it's only the partner god help them all

And "who'd have to pay for care?" is a hideously complicated issue, ThornAmongstRoses, especially in circumstances like this. Best to assume nothing and to get that urgent legal advice so many have mentioned

It sounds like a recipe for disaster. Stay well out of it. No amount of money would make me be an indefinite carer to an elderly parent. The fact he is willing to set up camp in their garden tells me everything about his expectations as he ages particularly when it seems he could have well afforded to downsize and buy in care. But no, family will be on tap.
And take advice about that £25k, you could be on a sticky wicket there if he doesn't live several years.

I’m fifty two, I don’t need my daughter to sit down and go through the legal implications of decisions I make unless I specifically ask her to, because I have my marbles. I would suggest this man is the same in the absence of further information from the op.

Would you then expect your daughter to put you up for 12+ months as a result of the decisions you made without first including her in that process?

@ThornAmongstRoses

When FIL talks about this plan sometimes I get the impression he knows it’s a disaster but he’s too scared to back out and so puts on a front about how wonderful it’s going to be.

Does he want you to actually say something? Is this part of why he's going to move in with you first off?

You have to say something!

Set him up with some legal advice so it's not all directly coming from you.

This stinks to high heaven.

Bless him, he is old and scared and wants to be near his daughter who he clearly thinks will care for him best.

He’s not old.
He’s not scared.
And SIL sees him once a year and she lets her partner treat FIL awfully - so no, I doubt very much that he thinks she will care for him (especially in comparison to me and DH would who see him at least four times a week).

I think there's a tendency for people when they reach a certain age to become a bit obsessed with how they're going to leave their money. And to start talking regularly about it, making / re-making wills etc and letting the whole topic occupy a lot of their mental space.

Maybe it's a coping mechanism with getting older. Of course he could go at any time, but the life expectancy for a man in Britain now is 80, so he is likely to live about 15 more years. A lot could happen in that time.

If I were you I would be asking him if he is going to be written onto the deeds of SIL's house as a co-owner - even if just at 20% ish. Then if/ when he does die, that can be split however he wants.

@Bluntness100

You both need to sit down with FIL and go through all the legal implications but don't mention the fact that it's potentially unfair to your DH

Um. No they don’t. There is no suggestion from the op this man is not mentally capable of making his own decisions. Do you have kids? Do you feel that before you make any big decisions you can’t be trusted and your kids needs to sit you down and go through the legal implications? At what age do you think your children should take control like this and you loose responsibility?

I’m fifty two, I don’t need my daughter to sit down and go through the legal implications of decisions I make unless I specifically ask her to, because I have my marbles. I would suggest this man is the same in the absence of further information from the op.

You're obviously switched on.

Some older folk can be less so. My Nan (70) is currently going through a house sale to downsize to retirement flat but she hasn't got a clue. All calls go through my aunt, she chucks all the legal documentation to us to read and honestly wouldn't even consider some of the points raised on this thread.

There's no harm in sitting down with him and having an open discussion about some of the legal aspects and certainly should consult a solicitor.