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Original poster

Chance to be mortgage free

25 replies

Guineapiggiesmalls · 14/08/2023 19:13

I’m due to inherit a property in the town I grew up in. The relative has very kindly suggested that we move into this house now, live mortgage free and use the equity from selling our current home to buy them a much smaller property in the same town. If we did this, I would be able to stop working and spend more time with the kids (I currently work fulltime). All very nice so far.

I’m dithering because we currently live in a suburb much closer to the city (15 minutes vs an hour+), that has excellent schools, both primary and secondary. We’d likely have to send our child to private secondary if we were to move.

Moving ‘home’ feels a little like giving up, I think I’d miss my social life a lot and all the conveniences of living near a major city. It would also be the death of my career. Financially it makes perfect sense to move, but I really like our life at the moment and I’m conscious of how much this very big decision affects my family!

What would you do?

OP posts:

MaggieFS · 14/08/2023 19:27

Gosh, what a generous offer.

Without wishing to sound crass... it sounds like the person isn't likely to pass away soon, if the plan includes buying them a different home?

So in that case, you are weighing up no working vs. the loss of social life and costs of private schooling (with a question over if you could afford that and not work?)

On the other hand, if you may inherit in the next few years, I would sit tight, sell the other house once you inherit it and use the proceeds to pay off your mortgage at that point.

Sorry, I'm sounding horribly blunt but I'm not emotionally involved!

FWIW, I work FT and I'd love to spend more time with my kids, but not at any price and the social life and particularly schooling sound like deal breakers to me.

karmakameleon · 14/08/2023 19:31

Would they be gifting the current big house to you now or would you only get it when you inherit? Will they still be attached to it and assume they get final say over decor, renovations etc? Who would own the new smaller house?

I would suggest they sell their current home and buy themselves a smaller more suitable one. If they wish to they can gift you the money now but obviously that would be their choice and very generous if they did so.

UsingChangeofName · 14/08/2023 19:38

I'd stay where I was happy and enjoying my life.

Some years down the line, if I inherit a house worth considerable sum (which it sounds like it is), I would make decisions based on my life then.

If the person (parent?) wants to downsize, I would be encouraging them to sell their house and do so, not try to bribe me away from my dcs' schools, my independence, my job , my friends and my social life.

Peeeas · 14/08/2023 19:39

Need to be careful re SDLT if you structure as planned - if they give you the house in exchange for you buying a house for them, you will have given 'consideration' for your house to the value of their smaller house. Might be fine if smaller house below the SDLT threshold. As pp said, sale then gift of excess likely to be simpler, especially if you're not convinced on location.

Mamette · 14/08/2023 19:48

I would not do it.

we move into this house now, live mortgage free and use the equity from selling our current home to buy them a much smaller property in the same town.

This sounds like a can of worms. A much smaller property will likely be a big change for them. Maybe they will want to visit their old house often. Will there be caring responsibilities for you?

CatsOnTheChair · 14/08/2023 19:52

Alternative: they sell the house; buy their own, smaller, property; and gift you the cash balance to reduce your mortgage.

Or is the crux of it for them to be able to control their pervious home by having a direct link to you to comment on changes....

Unicorn2022 · 14/08/2023 20:11

It would surely be an awful idea to move. It sounds like there is one benefit, which is being mortgage free, and about a dozen negatives. Surely if you have to pay for independent school that will cost way more than your current mortgage so you won't be better off on a monthly basis, plus you will be living life in an inconvenient location.

Can't your relative sell the house now and buy themselves somewhere small, gifting you the money to pay off your mortgage?

AcclimDD · 14/08/2023 20:35

I wouldn't do it. It'll come with strings.

Original poster

Guineapiggiesmalls · 14/08/2023 20:48

Crikey, a unanimous no!

To clarify, it’s my mum and I’m an only child, so although there would be care expectations at some point (likely in the not to distant future), I’d be happy to fulfil them and would be doing so regardless of the house I’m in!

OP posts:

EldenRing4 · 14/08/2023 20:50

If your Mum is willing to gift you the family home outright why can't she sell and move herself, then give you the cash? why do you need to live in the family home?
Is her home less saleable than yours?

DryIce · 14/08/2023 21:01

I'm not sure it is a great option, although it sounds generous on the face of it. If you're selling and buying her a place anyway, the gift is really the difference in equity between your current place and the relatives place. But why over complicate that by selling yours, buying another, and moving to yet another?

Why don't they just sell their house and gift you the change from purchasing a new property?

SummerSazz · 14/08/2023 21:03

You'd need to watch out for deprivation of assets too. So inheritance tax if the gift is made <7 years before she passes but I think deprivation of assets can go back further

Luana1 · 14/08/2023 21:21

I wouldn’t do it - if you had wanted to live in your home town you would have moved back there already. Don’t give up your quality of life because your mum is trying to entice you back home.

MissLucyEyelesbarrow · 14/08/2023 21:31

You need tax advice. As a child, you can inherit a substantial amount before IHT thresholds kick in. But, while your DM is still I alive, I think you will pay tax on any gift worth more than £7,000 (but I'm definitely not an expert on tax, so check this). So be careful, because you could end up paying much more in tax if you "inherit" before your DM dies.

AllyCart · 14/08/2023 22:44

No chance.

Not with so many negatives, including throwing your career away.

cestlavielife · 14/08/2023 22:50

Sugfest they sell.up and buy smaller property fir them .if they want a,smaller property they csn do that without you moving in qnd selling.

You would be daft to give up your career your pension your life

JaukiVexnoydi · 14/08/2023 22:57

It's probably intended kindly but it's not appropriate for even thr kindest relative to decide where you live.

If your relative wants to downsize then that's great, they can sell their current home on the open market and buy a smaller property. If they want to they can put the excess cash into your current mortgage and get you that much closer to being mortgage free but still living where you are happy.

If this "gift" is conditional on you obeying your relative's command to relocate somewhere that doesn't work for you then you have to politely decline. It will end badly otherwise.

Clefable · 14/08/2023 23:10

The best thing to do is for her to sell the house, downsize and then give you some of the released money. What she has proposed could potentially leave you vulnerable if she isn't actually gifting you the house, just the promise of inheriting it some day, when it may end up being used for care fees, she could meet a handsome tennis instructor, whatever. Even gifting you the house and then you buying for her has various issues to do with capital gains tax and stuff that is just needlessly complex.

If your mum doesn't want to live in the big house anymore and wants to downsize then selling it makes the most sense, unless you are desperate to live in that house.

MaggieFS · 14/08/2023 23:26

Guineapiggiesmalls · 14/08/2023 20:48

Crikey, a unanimous no!

Oh fine, well if the option of selling that now and you using the proceeds to become mortgage free in your current home is an option, why wouldn't you just do that? rather than the overcomplicated scenario in the OP.

DrySherry · 15/08/2023 08:49

It sounds to me like your Mum wants to ensure you are close to her, in her town, for the ease of future care needs and convenience. I can't think of any other reason she would want to structure it this way. One the one hand it sounds generous, on the other it sounds majorly controlling. Only you really know which.
I personally wouldn't do it that way just to ensure its convenient to nurse your Mum.

MaggieFS · 15/08/2023 19:17

Yep, I agree with what @DrySherry said

Original poster

Guineapiggiesmalls · 15/08/2023 22:02

Thanks for the thinking points, I appreciate everyone’s input. I think I’ve perhaps misrepresented my poor mum, but that’s my own fault!

We had always thought we’d move to my hometown at some point, but this would be quite a bit earlier than planned. I hadn’t thought of pension either, although we’d be saving so much on our mortgage I could always pay into a private pension.

OP posts:

calmcoco · 15/08/2023 22:06

What property would you own whilst your mum is alive?

This sounds like an enmeshed mess tbh.

You should choose your own house. Your mum should choose her own house.

If your mum wants to gift you some released equity, that would be a very kind gesture. But all the house swapping sounds a nightmare.

MaggieFS · 15/08/2023 22:57

Why would you want to move to your home town given what you've said about schooling and social life?

user78262102928 · 15/08/2023 23:16

No. No no no. Enmeshed controlling hell. No.

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