Buying parents house .

[Bedsheets4knickers]

My dad lost his job 2 weeks ago. He has no private pension . They own a property of about £160k. I don't live there my younger sister still does. We have about 15k in savings between us . We want to buy the house at full asking price.
We can both afford the mortgage . We want our parents to carry on living there like normal. We would both be 1st time buyers. What's important to us is a) my parents enjoying the decades if blood sweat and tears that have gone into
paying the mortgage b) to get a foot on the property ladder.
Can anyway advise on this situation . His work pay ends in jan then they are relying on pension .
Tia

They also are very embarrassed of this situation. My sister and myself just giving them cash will be hard for them.

If you want to support them and can afford it, then you continue to do so

Can you explain why you want to take out the mortgage when it's not necessary and won't benefit your parents or you?

270 per month

I'm throwing ideas at them as I read these messages. Sorry if I'm missing any

Bedsheets
They have to stop being embarrassed, as do you.
They brought you up well enough that you are now able to help them out.
In that way they are successful parents.

If your mum has not worked for 12 years how ON EARTH have they got by without disability assistance.
Your dad has had strokes
WOW they need to swallow their pride and go see the CAB and get the support they are entitled to : pension tax credit is about income not capital
and their capital is, compared with many, a pittance.

But please, do not give a bank any of yours or your parents' or your sisters cash
you deserve it
banks do not

Armani because they'll get the money from the house . We invest In property

Bedsheets
£270 a month : holy crap - they HAVE to be entitled to tax credits
and either they take it or the bankers get it

if you give them £160k, they suddenly have savings that will bar them from ALL benefits
bad move
If you pay them "rent" every year at just below the tax / benefits limit that transfers the house to you and your sis while giving them income and keeping ALL Of the money from the house in your family
not in the hands of the greedy bastard bankers

When it first happened she recieved benefits they then cut them back them stopped them altogether . Because she has little feeling on her left leg she walks heavy on it causing the foot to go over causing callous. My dad hasn't been diagnosed as having strokes . An MRI scan has found white spots on the brain but nothing official they said it's probably minor strokes. He's booking it to see dc nxt wk.

But you'll be spending about £300,000 on a house that doesn't need to be bought!

That isn't investment. You may as well burn your money.

What your parents could do is sell it on the open market and downsize, have some spare cash and maybe bung you and your sister a few quid to help you get on the ladder.

Or do what someone said upthread - get a proper contract done, give them money and then you inherit the house.

I would prefer a properly contract my dads mind isn't what it was , his dad had demintia. I would like something sound.

Property

£270 is only for food though so think it is doable as a start. As long as the house is willed to each other then you/your sister on the second death you don't really need to buy into it. There won't be any inheritance tax liability etc. Talkin may sound very anti bankers (!) but the basic sums mean that you would be paying out more in interest on a mortgage than your parents would benefit from by having that money in the bank ergo you all lose out, while the lender benefits.

Pesky from £160k property??

bedsheets
Go see a solicitor about wills and lasting power of attorney
while the four of you are at it get the property transfer deed written
total cost around £1000 for the four of you
done, dusted, secure relax

Lizs
Moi, anti banks
Bedsheets
If you buy a £160,000 house on a standard 20 year repayment mortgage it will cost you around £300,000 including interest
ie the bank will take £140,000 of money from your family that could have been better used by you, your sis and your parents

Interest paid over a period of time plus capital repayments could well add up to significantly more than the original amount borrowed. Interest alone at 5% is around £600 plus capital repayments each month.

OP
Here is the thread
www.mumsnet.com/Talk/legal_money_matters/1987219-SPREADSHEETS-for-Debt-Control-Budgeting-Mortgages-etc
and here is the spreadsheet with OP's numbers in
docs.google.com/spreadsheet/ccc?key=0AiZqlQ7-gn07dDN4clg5OXhLMGJWbHZhOEo4UTJINEE#gid=0

After the ten years, you (& sister) would own the house. They'd have £160k in the bank (minus living expenses etc)
You'd re-assess, they might pay you nominal rent or you might all choose to sell up. This is why it might be best to get professional advice - I understand your concern, but right now they (potentially) just need need a hand with some bills / normal living expenses due to redundancy. They don't necessarily need £160k outright in the bank, which you'd need to get a mortgage for to be able to give them. There's going to be other ways, potentially more beneficial to you all, which allows you to help them out -but without you needing to take on a 160k mortgage.

Be aware care/home may be needed for parents when older so property would be regarded as their asset unless you have a watertight legal agreement in place.

If you take out mortgage, not only will you pay more in interest to bank (money your parents won't see) BUT also your parents will have a cash lump sum that will mean they are not entitled to state benefits & they have to invest - probably at lower interest rate than you will be paying!

Don't rush into anything. Take it slowly.

Talking thank you :-)

I was thinking out of the 160k they recieved . They could invest in another property 110k or so and rent that out . As a monthly income ?

NOPE
Honest
xx

How much are properties worth 110 k in your area renting for?

They won't be able to receive benefits as they will still have too much capital - plus I suspect from what you said you and your sister would have to take over managing the property - repairs, sorting out tenants etc.

I do think a private agreement where you and your sister buy the property over a period of time would work best, and be more efficient.

Also, it isn't a guaranteed income for them - problem tenants, vacant periods, major repairs etc....