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Borrowing money from family to buy rest of shared ownership house

6 replies

Saffy73x · 24/01/2022 13:00

Hello, I live in a shared ownership house and wish to purchase the rest of the 60% remaining. As a self-employed person my accounts are not allowing me to get a mortgage. My sister has the money sitting doing nothing in an account (due to selling property) and would like to lend me the money until we sell our deceased parents house, where I will be able to pay her straight back (this won't happen for 2 years due to agreement with current tenants) Current solicitor forms are asking whether this is a gift or a loan. What are the implications of either a gift or a loan in terms of tax that I might not have considered? I will also be paying my sister a small amount of interest each month. Thank you for your advice.

OP posts:
HebeMumsnet · 24/01/2022 22:15

Just bumping this for you, OP. Hopefully someone else will be along who knows more about this.

RedHelenB · 25/01/2022 08:28

It would be easiest to say a gift, but that would be dependent on how much your sister is prepared to trust you to pay it back.

Saffy73x · 25/01/2022 09:25

Thank you both, yes, I think we've decided the 'gift' route for ease.

OP posts:
etulosba · 25/01/2022 09:35

With a gift there could be tax implications….

moneyfacts.co.uk/savings-accounts/guides/how-much-can-i-give-as-a-cash-gift-and-how-is-tax-affected/

etulosba · 25/01/2022 09:40

This is possibly a better explanation as it doesn’t focus on offspring…

www.reassured.co.uk/life-insurance/how-much-money-can-you-give-as-a-gift-uk/#:~:text=Cash%20gifts%20can%20be%20a,known%20as%20an%20annual%20exemption.

LizziesTwin · 25/01/2022 09:46

Private mortgage if you are repaying a small amount of interest?

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