Buying part of house

Part

My brother is due to inherit my mother's house. I am interested in buying part of the house. My brother is in need of money in the short term.

Is there a way that we can draw up an agreement, so that I can pay him the money he needs now and in exchange I would own part of the house when he inherits it?

If my mother changes the will etc. the money would be repaid.

lifeandtimes

Side question you would probably want to ask first.

Can you allocate value between people for something they do not own...yet?

dats_right

Part wrote: »

Is there a way that we can draw up an agreement, so that I can pay him the money he needs now and in exchange I would own part of the house when he inherits it?

No, at least not any agreement that protects your interests properly.

Part wrote: »

if my mother changes the will etc. the money would be repaid

Your mother can do as she pleases with the house until she dies. If she changes her will or sells the house then nobody could stop her (provided she retains mental capacity, etc). As such, you would have no security or interest in the property until your brother inherits it. If he didn't inherit it for any reason, you would be left with an unsecured debt and crossing your fingers that your brother repays you.

It occurs to me that there could be other ways to achieve what you want to achieve, but you would need to talk to a solicitor.

Peregrinus

For any document transferring an interest in property either now or in the future, you need a solicitor.

What you are proposing here, though, is tricky. You'd pay your brother an agreed amount, in exchange for which he would transfer you a share in your mother's house, if he inherits it on her death, or repay the agreed amount (with interest?) if he does not inherit the house.

You'd need to cover all the possible eventualities. What if your mother sells her house, buys another one, and your brother inherits that? What if your mother sells, banks the sale proceeds, and your brother inherits those? Are you entitled to a share of the inheritance, or simply to the return of your money? (These might be very different amounts.) What if your brother dies before your mother? Who is to repay you then? What security will (or can) your brother give to ensure that you will be repaid if he does not inherit the house? Etc, etc.

This is a complex transaction, contingent on a variety of future events which may or may not happen, and which lasts for an uncertain time. To be honest, if you were looking to design a transaction which is quite likely not to pan out as originally forecast, this would be a good example.

If you want to help your brother financially, I think you should find a simpler way of doing it.

se conman

Would it not be possible to purchase a share of the house from your mother and let her gift the money to your brother.

Part

se conman wrote: »

Would it not be possible to purchase a share of the house from your mother and let her gift the money to your brother.

In this case would it be possible to get my brother to sign an agreement relinquishing any interest in the part of the house that changes ownership?

If I were to buy part of the house directly from my mother, could this be legally challenged on the basis of dementia, which she suffer from?

lifeandtimes

Part wrote: »

In this case would it be possible to get my brother to sign an agreement relinquishing any interest in the part of the house that changes ownership?

If I were to buy part of the house directly from my mother, could this be legally challenged on the basis of dementia, which she suffer from?

You need to speak to a solicitor

Peregrinus

Part wrote: »

In this case would it be possible to get my brother to sign an agreement relinquishing any interest in the part of the house that changes ownership?

He doesn't have any interest it it; it's your mother's house.

Part wrote: »

If I were to buy part of the house directly from my mother, could this be legally challenged on the basis of dementia, which she suffer from?

Yes, it could. If your mother made an enduring power of attorney before she lost her mental capacity you could possibly deal with her attorney, but he might very well decline to enter into the transaction. (He should decline, since it seems to be for your brother's benefit rather than your mother's.)

Your mother's dementia complicates matters considerably, and underlines that you need to see a solicitor.

The bottom line here is that you are trying to buy a share in your brother's expected inheritance. You can lawfully do this, but its a complex transaction since you don't know for sure (a) when your brother will inherit, or (b) exactly what he will inherit or (c) what it will be worth when he does inherit it. Any agreement you reach with your brother has to cover every possible contingency which could unfold into the future.

And there's an additional element of risk for you, since you envisage that if your brother doesn't inherit the house he is to repay the money. Your brother is strapped for cash. If he doesn't receive the expected inheritance, what makes you think he will be able to repay the money? Are you willing to sue him for the money, if you have to? If the reason he doesn't inherit is that he dies before your mother, are you willing to sue his widow? I think you should think fairly realistically and rigorously about the practical risk of non-repayment in a deal like this.

Mr. Incognito

See a solicitor

Pat Mustard

Part wrote: »

Is there a way that we can draw up an agreement, so that I can pay him the money he needs now and in exchange I would own part of the house when he inherits it?

Another question can be phrased more generally, with an answer that may be more useful to you: "Is there a way that we can draw up an agreement, so that I can paylend him the money he needs now and in exchange I would own part of the house when he inherits it using the property as security?

I would echo the advice of the others on this thread, to consult a good solicitor.