property

[mrslil]

My mother lives alone, and has no mortgage. My husband and I are thinking of moving in with her (as she requested). My mother wants to sign the house over to me (cause Im her only child), and we need to raise the money to bring the house up to date ie take out a small mortgage(�40,000). We would like to do it the right way, but dont want to line a solicitors pocket, with ridiculous costs. Can anyone help??

[Maud]

The name change should be done first, and this is quite easy to do yourself - if the land is registered it involves 2 forms, a fees cheque, finding the existing Land Certificate and attaching together and sending to the LR (around here about �250 + VAT at a solicitors). If it is unregistered it must first be registered and then proceed as I have just said (solicitor would add �50 + VAT). If you would like to do it yourself please say whether registered or unregistered and I will post details. With regard to the mortgage, you can do it yourself if you understand legal jargon, and if not just go round the mortgage providers (Saturdays Telegraph usually lists the cheapest rates) find the one you want, obtain an offer and a copy of their contract and before signing take the contract to a solicitor for him to tell you the implication of each clause (around here �100 + VAT).

[mrslil]

The house is registered in my mothers name, as she is the sole owner of the property. I have TR1, and AP1 and sent for a SDLT60?? (I read your post to another lady). We are a bit confused as how to fill them in. Can you tell me if there are any complications or objections to doing it this way, as we dont want anything to go wrong, now or in the future. Thank you

[norfolk boy]

Well you can rest assurred our maud will give you a truthful answer and come up trumps as usual !

[Maud]

Pleased to hear from you, norfolk boy - trust all is well and with Mrs norfolk boy. There are no problems at the Land Registry, mrslil. Send the forms to your District LR Office where they are checked by an Asst Land Registrar who will contact and assist you if something is spotted. There are no legal points to deal with. They then go to a Land Registrar (a solicitor) who ensures that all legals are correctly transferred to the new Land Certificate and authorises the issue which you receive in about 6 weeks. The problem arises in the transfer of title to you as sole proprietor. This is regarded as a gift by the Revenue and for 7 years falls for IHT - the full 40% for the first 3 years and a reducing scale for the last 4. Obviously I know nothing of your mother, but if she is unlikely to survive 7 years then you will receive a bill for many tens of thousands of pounds at her death. There is, however, an alternative, and that is to hold the property in joint tenancy with your mother. This way, when your mother goes the title simply transfers automatically to you, without probate, IHT or anything else. More than two people can be in a joint tenancy, so you could hold the property to include your husband, and IHT would only become payable at the death of the last survivor. This also defeats any claim for immediate reimbursement of costs should your mother have to go into state care - a joint tenancy cannot be forced to sell to pay any such claim - at the worst it is only payable at the death of the last survivor. If you would like further discussion on joint tenancy please post. With regard to the forms, when you have finally decided which way you would like to hold the title I will post what should be in each box, if you would like that.

[Maud]

PS. I'm sure you know, of course, but I intended to include that IHT is only payable on an estate valued above �263000.00.

[mrslil]

Thanks Maud, the property is currently valued at �100,000. We would like my husbands name to be included in the property deeds. My mother is 64, and in good health. We dont mind which way it is done, as long as we dont end up with a huge debt to pay if circumstances did change. Looking forward to your reply.

[Maud]

The �100000 will be added to your mother's estate for calculating IHT as above. Concluding how to hold the property, there are 3 common ways (1) sole proprietorship, which is self-explanatory (2) joint tenancy as referred to above which is based on equal theoretical non-willable non-saleable shares and survivorship and (3) tenancy in common which is based on willable and saleable shares. Turning to the forms: AP1 1 presumably you know your LR Admin area (if not look in Contact Us at the LR website) 2 Title No from your existing Land Certificate 3 N/A 4 x in whole 5 Change the register for your Title No �100000 Fee �40 Pay by cheque 6 Your existing Land Certificate 7 Your name and address 8 Your name and address if mother is not dealing with the paperwork 9 2nd optiom, repeat 8 10 If there are covenants in the existing Land Certificate print out D1 and repeat them 11 N/A 12 Mothers signature TR1 1 x 2nd option 2 repeat 2 from AP 1 3 Full address postcode of the property 4 obvious 5 your mothers name and address 6 names and addresses of the combination in which you have decided to hold the property (you, you and mother, you mother and husband, whatever) 7 repeat 8 from AP 1 8 nothing to enter 9 x in 3rd option 10 x in 1st option 11 I suggest 2nd option but it is entirely up to you 12 repeat D 1 if you have used it 13 (a) your mother must sign in the following form: Signed as a deed by "mothers full name" in the presence of "witnesses full name" Mothers signature Witnesses signature Witnesses full name in block capitals Witnesses address (b) If you have put anything in 12 then all of those in 6 above must sign using the same words (c) the witness can be anybody other than yourselves Thats all there is to it!

[Spags]

Hi Maud, I am in a similar situation to mrslil, except that I have 3 sisters (2 of whom have fallen out with my father) due to our arrangement. My father wants to transfer the house to me, while my wife and I move in to help look after him, but we would need around the same amount of money to bring his property up to date too. If he put the property in both my wifes name and my name, would my siblings have any claim on the property if anything happened to my father?. Or do you recommend we have a three way joint tenancy, and how would this affect my legal position with my sisters? Thanks

[Maud]

Hello, Spags. The three-way joint tenancy is best because (1) it removes the worry of an IHT bill turning up unexpectedly at an awkward time which has to be paid with funds from somewhere before probate is granted, and (2) the simplicity and ease with which the property is transferred to the survivors. Providing that each of you makes a will, and this is absolutely essential, neither siblings nor sisters can enter into any matter other than in accordance with your express wishes.

[mrslil]

Hi Maude, Just got back from holiday, We are ready to sign the papers. Before we do, there are a couple of things if you could help? Question 5 on AP1, we dont understand exactly what we write and where. And question 7 on AP1 does my mothers name go here?. Appreciate all your help, sorry to be a pain, but just want all to go smooth, Thanks

[mrslil]

Ps, As we have decided to go three ways, will this have any affect on getting a mortgage, as we dont want my mothers name on the loan? It will be my husband and I who will be paying for everything, so all debts will be ours, not my mothers. Ta

[jrwalker]

Hi Maud, my partner is in a similar situation. She had a 3 way Joint Tenancy with her parents and survived over her mother then recently, her father. The 3 off them lived in the property. Both my partner and father have contributed to the maintenance, improvements, landscaping and furnishing of the property and gardens. He died intestate. The property passed to her under survivorship. NOW her siblings as administrators of his estate claim that garden shed, greenhouse, fish in pond, pond pump, trees, shrubs etc, carpets, rugs, crockery items etc etc in fact anything paid for by her father, whether, fitted, fixed or movable....is an asset of his. Are they right? My partner does not claim ownership of any personal effect of her father (or mother).