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Original poster

Buying sister in law a house?

37 replies

Mumof3andahampster · 21/11/2023 04:48

Myself and my husband have a decent house it has four bedrooms, we bought it run down and spent years doing the work on it to make it what it is today. We still have a big mortgage on it which we manage although it leaves us with little cash at the end of each month.
My sister in law rents her house following a break up and has no money left from the divorce, she’s not good with money.
My parents in law want to buy a house in both my husband and SILs names for her to live in as she can’t afford to buy herself. We understand that they want to help her as she is on her own although how will this work for all involved? Could there be complications as we will be also be part owning the house? Any advice appreciated.

OP posts:
WhereIsBebèsChambre · 21/11/2023 07:57

rose69 · 21/11/2023 07:32

I would avoid as costs such as maintenance, lease, insurance. Will SiL also expect him to maintain the property such as minor repairs and arranging for major work.

Could this be parents plan to ensure sil is 'looked after' once they're gone?

Original poster
Mumof3andahampster · 21/11/2023 08:01

I think they are thinking of ensuring she is stable yes. She has no money saved as far as I’m aware, she does know they have money and will always bail her out so never needed to save. We are a lot younger than her. We are both 32 and she is 40. I feel that this will be the home she stays in unless she met someone else in the future.

OP posts:
1975wasthebest · 21/11/2023 08:04

If one of or both of your in-laws need care then as a pp said, this could be considered deprivation of assets. Their local authority have the power to go back years when they check assets and this could result in a very messy situation in the future for everyone involved.

StiffyByngsDogBartholomew · 21/11/2023 08:18

Are they proposing to take out a mortgage on this property or buy it outright ?
Either way you need to take legal advice not get ad hoc advice on MN - as should his parents. I'm pretty sure a house would well exceed the maximum annual tax gift threshold.

Turmerictolly · 21/11/2023 08:19

What if they buy her a house and there's no money left over for your dh if they need to sell their own home for care costs. How would you both feel about that?

Too many pitfalls in this plan.

Original poster
Mumof3andahampster · 21/11/2023 09:07

Their plan is to also put their own house in my DH and SIL’s name too. They will have gained financial advice. Their house would likely be worth more than the house they bought SIL, I’m not sure though as it hasn’t been discussed what they would spend. It would be bought outright though as they are too old to get a mortgage

OP posts:
Holdyournoseandthinkofchocolate · 21/11/2023 09:23

Mumof3andahampster · 21/11/2023 09:07

Their plan is to also put their own house in my DH and SIL’s name too. They will have gained financial advice. Their house would likely be worth more than the house they bought SIL, I’m not sure though as it hasn’t been discussed what they would spend. It would be bought outright though as they are too old to get a mortgage

Ah. Well that is a much sillier/more complex situation. To achieve anything IHT-wise around this, they would need to pay your DH/SIL rent for the rest of their lives.

And what if your DH divorced you? You would have a claim on his assets which would include the house they live in.

Not to mention deprivation of assets which would even more clearly be an issue here.

I would ask to see the advice they have received on this and check who it was from, and exactly what was covered.

saraclara · 21/11/2023 10:09

As long as they're both fit and well at the time they give anything away, deprivation of assets isn't an issue. It's only if either has a condition that is likely to require care in the future that they need to be concerned about that.

Spirallingdownwards · 21/11/2023 10:17

The parents need to get proper financial advice. Their current plan is a disaster fkr number of reasons including tax liabilities for your DH!!

1975wasthebest · 21/11/2023 13:42

saraclara · 21/11/2023 10:09

As long as they're both fit and well at the time they give anything away, deprivation of assets isn't an issue. It's only if either has a condition that is likely to require care in the future that they need to be concerned about that.

It’s not quite as clear cut as that. It’s about having a reasonable expectation they may need care in the future, at the time the assets have been given away. These assets worth six figures that have been given by people in their late 60s will be looked at carefully, if and when the time comes. It’s quite a gamble for the parents.

HerMammy · 21/11/2023 13:49

So if they put everything in DH and SIL name, are they assuming they'll be provided free care as they can claim they have no assets? Very immoral.

StiffyByngsDogBartholomew · 21/11/2023 20:03

Spirallingdownwards · 21/11/2023 10:17

The parents need to get proper financial advice. Their current plan is a disaster fkr number of reasons including tax liabilities for your DH!!

Putting a house in the names of two persons, neither of whom is registered there to vote, is a recipe for LA to look into under deprivation of assets in the event of going into a nursing home and claiming to be unable to self fund. It would be done on land registry, to which the LA has access. However it would only be taken into consideration fir the second parent as if there is a partner still living in the property it is not considered in à financial assessment (I think)

LAs are wise to this.
unless your parents are under 70 this is a very dodgy proposal. Of course if they would be able to self fund any care then fine.

sorry @Spirallingdownwards ivevquoted u by accident

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