Can I use sons trust money to buy out my partner?

[Jessica8282]

Hi, I posted a while ago about my son inheriting a big lump of money.

Well we’re awaiting the sale of that family members house before we receive the money. All I know is that I will need to hold the money in trust for him until he’s 18. I haven’t spoken to the executor about this as I don’t know them (they’re not a family member) - but I think I am now going to need to talk to them due to what’s happened at home.

Quick overview; my son (13) and I live with my partner of 7 years, and his daughter visits every other weekend.

I’ve been unhappy in the relationship for quite a while, but trying to make it work to avoid any more disruption for my son, and because it’s not always bad - especially for the kids who get on incredibly well. However one of the reasons I am unhappy is that my partner has a nasty side that comes out occasionally, where he loses his temper unpredictably and starts yelling abuse.

Well that happened again this weekend, I won’t go into the details, but it was in front of our kids and over something ridiculously petty. It’s ruined the weekend, and everything really. I feel completely done with him.

Which leads me to what on earth am I going to do. We’ve just bought this house in 2020 it felt like we’d finally settled down and achieved stability. My son loves it here, it’s close to his school, friends, we have a dog, two cats etc. I can’t see us being able to afford anything more than a two bedroom flat in a not very nice area, and it breaks my heart thinking of putting him through that again (we went through it with his dad when he was 4).

So I want to try and find out if I can use the money he’s been left to help buy out my partner. I’m going to try and get actual advice in the next couple of days, but it really impacts what I do and say right now, knowing if I have a chance to do that. My thinking is that I would then sell (or remortgage if I could afford to then) when my son is 18 - or whenever he wants his money. I could move into a smaller flat at that point and wouldn’t really matter as it would just be me.

I’d really appreciate it if anyone with legal or financial knowledge about keeping money in trust could let me know if this sounds possible or not? Thanks

It doesn't sound right to me as its not your money to use; it's his. I am not a lawyer though

No it's not your money it's your sons money.

You might be able to if you put his share of the house into trust for him too - so he owns part. But you need legal advice how to do this and for the implications.

No idea but agree - it’s not your money. This is down to you to sort.

Surely that would mean he would no longer be a first time buyer and he would be a part home owner who had no choice.

If you'll have his money ready to give to him at 18 then I really can't see the issue. You're basically using it for his benefit over the next 5 years to buy him stability.

Does he know about the money? Is he mature 13, so could you discuss your plans.

Bit of my DS would understand the logic, and it keeps the money safe and invested.

I think you’d need to have the agreement of the trustees - will that just be you, or will there be someone else involved too?

In principle, a property could be bought in trust for your son - you would not be the owner of it - and as you say, there would then need to be an agreement drawn up about its sale.

Does the trust have enough to buy your partner’s share outright, or enough to buy the house outright? It gets more complicated if you’re a joint owner, I would think. But I’m not an expert.

You might want to try this on the Legal board rather than money?

Where's the money at the moment? I think you could propose it to the other trustee as long as it won't disadvantage your son- ie it's like an investment. It might affect later options for him like first time buyer options.

I wouldn't want to explain to him when he's older that you've spent it on him. Even if it was to help him when he was little.

Of course, your DP will need to agree to sell his share to you first. Is that likely?

I know you can have money ring fenced when buying a property. So you could certainly do that if you’re allowed to do that. Take legal advice.

If it's held in trust you'll need the authorisation of the trustees.
I'm not sure wanting to chuck your partner out and buy his share of your property would be something they'd agree on, tbh. But ask 🤷🏻‍♀️

I see absolutely nothing to stop you using his money to buy a share in your home, as long as it's held in trust for him. It could be a good investment and may be better than the stock market. Obviously you need to get good legal advice though.

Well, permission from the trustees, possibly...
It's not her money.

but it really impacts what I do and say right now, knowing if I have a chance to do that.

I really don't think you should suggest this idea to your partner or whoever whilst discussing your break up. It’s likely to be a complex process if it’s allowed and could make the situation worse. Is your son on board with this idea?

I don’t no about the legalities, but I don’t think it’s fair using this money in this way. It’s for quite a short term gain until he’s 18, and then you say you can sell up when he wants his money but what decent 18+ year old is going to feel comfortable with forcing their mum to sell their home so they can have money? Depending on his personality it could put him in a difficult situation and he could end up delaying his own wants to keep you more comfortable, which is probably not what this money was intended for. I assume he’s ok with this idea now but I just don’t think it’s really fair, it’s your responsibility to sort housing with your own means not other peoples.

If it’s possible, it sounds very sensible. Your son gets minimal disruption going into his major school exams, his home is secure and his money is safely invested. He will get a better return than any paltry offerings from a savings account. I would do it.

If I were you I wouldn't rush buying more property. Do you have a decent paying salary? Do you have solid childcare if you go swperate ways?

I think morally it's wrong OP and you have only had the house since 2020. What about your partners daughter too?

Use your son's money that's supposed to be held in trust to buy a house in your name with 'plans' to pay him back?

I doubt you'd be allowed to do that.

The trust could perhaps buy the house and you pay rent to the trust. You'd need to talk to the solicitor to see.

That money should work for your son. The trust has a duty to ensure that it takes good care of it.

My eldest son has a personal injury trust. I am a trustee and his solicitor is the other. I can say with certainty that no trustee would hand you the cash to buy a house. They have legal obligations.

A roof over his head would be an appropriate use of his trust fund but like I say, it would have to be his not yours.

As Stripyhoglets said, it might be possible. Get some legal advice. Tell a solicitor about the abuse and that you want your son to have a share in the house.

Also, if you were allowed to borrow his money, you would be expected to repay with interest.

Maybe even calculating what it likely would have earned had it been invested for x years? Who knows?

My son's trust fund gains between £20,000 and £50,000 each year in the decade he's had it. ( It's not a massive fund). The trustee won't (or shouldn't!) agree to hand over money and tie it up for ten years and then get back fuck all.

I think you should consult a solicitor with expertise in trusts and conveyancing.

I think the trust could be a joint owner of the property while your son is living in it, if all the trustees agree. I am not a solicitor though so you should check with them.

i don't think it would affect your son's options in terms of help for first time buyers because he wouldn't be the legal (joint) owner, the trust would. As I said though I'm not a solicitor.

You could start the ball rolling by getting the house valued, it would probably be wise to get a few valuations.

I’m not a lawyer but IMO you shouldn’t even consider this money when making your choices. It’s not “there” yet and when it does arrive it’ll be your sons and not yours.

A lot of the disturbing factors if you do break up with your partner will be things that this money wouldn’t help anyway. Your partner and his daughter would no longer live with you. They might also take some or all of the pets, or you might not be able to afford to keep them all.

I think the idea that you’ll sell up when he’s 18 (and probably still in full time education, maybe about to leave for uni etc) is laughable, it won’t happen. Kids at uni (or for example if he joins the army or something) need somewhere to come back to for a couple of years and as others have said he’s not going to want to put you out of his home for his money. If you’re honest with yourself you know this won’t happen.

What are your other options? Can you go for a better paying or second job? Ask family for a loan?

I don’t know what sums are involved here but my feeling is even if you’re allowed to spend this money on the house, it’ll do far more to benefit you than him and he won’t see the money for many years if ever.

Also can’t help but wonder if you just want to do this/say this to score points with your partner, since you need to know right now. Sorry.

These questions should really be directed towards a professional rather than randoms on MN. Plenty even have free 30 mins consultations.

I know you’re not asking for advice on whether you SHOULD do it but house prices are also about to drop massively. They’ll recover in the long term, but not in time for you to recoup the £££ you paid in buying out his share.

Op I'm not saying you will do this as I hope you are level headed but someone I know was in a similar situation. Spent her sons inheritance he received from his father. Over 100k. This was her third marriage and she used the money to divorce and buy a house for them. Dont really know how the legalities worked but the son never saw that money again. She then went in to her forth marriage and bought with him which obviously swallowed her sons money and when they divorced he took half. Its absolutely disgusting.
If there is any chance you might meet someone new be very careful of how you would then stand legally. You need proper solid advice from a good solicitor.