Suggested to son he consider buying family home

vonievega

What are the benefits and complications/CBA when selling to son. He has deposit and can get a mortgage.
No auctioneer fees. Use same solicitor for conveyancing. Transfer of deeds should be straight forward.

Have never been very good at what ifs. And did you consider?
Advice is appreciated.
I will buy a place with sale money. Thanks

The_Conductor

First off- I think solicitors will no longer handle both sides of transactions for family members- there were a few cases that ended up in dispute- that have put pay to that.

Secondly- it sounds like you are planning on doing this at market value. If you plan anything other than market value- you are going to be tied in red tape for months- and have a nice bill to pay the Revenue Commissioners. If your intention is to help your child out- provide the gift by all means, as part of the transaction- but declare it fully, and be aware of the revised gift (inheritance) limits- as once you breach them, the tax implications are onerous.

Have you discussed this with your son? If you have decided you are moving- and that is that- why not simply sell on the open market? Any fees you might incur- will be peanuts in comparison to the upside in price you might reasonably expect to charge your son.......?

Is this a scheme to try and help your son out? If so- what are his options and what is his opinion of the proposed transaction? Does the location suit him for work/family life etc? If you are moving- will you still be local? Is he married- are children present or on the horizon? If he has a significant other- what is their opinion?

It sounds like you want to release money from the property- but still have the property stay in the family? What are your motivations? Might your son have similar motivations?

I'm just trying to tease things out here.

As for your son qualifying for a mortgage- under the new rules- he needs to have saved up a deposit of a minimum of 10% (saved- not been gifted, and not borrowed from elsewhere). He is also entitled to a maximum of 3.5 times his gross salary, excluding any bonuses etc- as a maximum mortgage. I don't know what he works at- or what he earns- but is 3.5 times his salary in the realms of what you imagine the value of the property to be?

What value did you value the property at for the purposes of paying property tax? You may have a payment due to Revenue- if the open market price of the property is significantly above the declared value............

You both do have quite a bit to think about- but I'd seriously suggest taking a time out and getting it clear in your mind first of all- what precisely you're proposing to do, why, how it benefits everyone, why your son should facilitate the transaction, and how signing up to this might change the life direction of your son etc etc.

I'm not being cynical- and I don't want to sound unapproving or awkard- I've just come across one too many ideas like your idea- that were pretty awful in the long run.......... Make sure everyone is fully onboard- and don't go on their verbal assurances- play out all the scenarious in your own mind- and make sure you're happy with all possible outcomes. If there is the potential for something to go south- even a fairly remote possibility- I'd suggest hang up on this idea- and think about simply putting it on the open market instead- and seeing what the outcome is there.........

Worse case scenario- you spend a couple of grand on an auctioneer and a solicitor or two- paying for their services might be the best money you'll ever spend............

spockety

Do you have any other sons or daughters...?

vonievega

I appreciate your answer and am going to show it to my son. Yes I have 3 other children. The house is mortgage free. I want to sell but as he is studying and working I thought if he got house under market value it would accommodate him and me. It would sell possibly 210 make a little more I'd sell for convenience 180 to him. He has a deposit of 60000 from an accident 3 years ag
o.
Thanks for rec thinking about revenue. Plus when it comes to family and dealings you could and are right it can lead to acrimony and feuds.
I'm going to read you CBA letter again as there is a lot to think about. Thanks again.

vonievega

One adult child living with me thought she could rent off him to reduce mortgage. If only life was that simple.

Atlantic Dawn

You can no longer use same solicitor for conveyancing, as of January 2013 the buyer and seller must have a seperate solicitor.

ucd.1985

vonievega wrote: »

What are the benefits and complications/CBA when selling to son. He has deposit and can get a mortgage.
No auctioneer fees. Use same solicitor for conveyancing. Transfer of deeds should be straight forward.

Have never been very good at what ifs. And did you consider?
Advice is appreciated.
I will buy a place with sale money. Thanks

Look into dwelling house relief. Most tax efficient way of transferring wealth between generations.