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Protection of friends' (creditors') interests in a property.

  • 21-11-2007 11:38am
    #1
    Flymask
    Closed Accounts Posts: 15 ✭


    I have recently borrowed money from two friends in order to purchase a property abroad (in Italy); one person loaning me approximately 25% of the purchase price, the other approximately 75%.

    In order to protect their interests, I wish to legally ensure, should anything happen to me before I repay the loans, that they would have rights over the property, as opposed to the property merely becoming part of my estate.

    Presumably, if I just make a simple will bequeathing the property to them, they would be subject to Inheritance Tax at the lowest threshold, due to their not actually being related to me in any way.

    While I have no reason to suspect that the main beneficiary of my will would leave my friends out of pocket should I make my wishes known to her, I would prefer to have a more clear-cut legal arrangement regarding my friends' interests and one which would not have inheritance tax implications for them.

    Any advice would be greatly appreciated.


Comments

  • #2
    Victor
    Registered Users, Registered Users 2 Posts: 78,494 ✭✭✭✭Victor


    Potentially allow the friend have a mortgage or similar against the property.


  • #3
    Tom Young
    Legal Moderators, Society & Culture Moderators Posts: 4,338 Mod ✭✭✭✭Tom Young


    Hire an Italian Property Lawyer in the first instance. This is notorious complex when dealing in land abroad.


  • #4
    Flymask
    Closed Accounts Posts: 15 ✭Flymask


    How do you go about doing that Victor? Could you explain the implications a little further, please? Thank you.


  • #5
    Flymask
    Closed Accounts Posts: 15 ✭Flymask


    Tom Young wrote: »
    Hire an Italian Property Lawyer in the first instance. This is notorious complex when dealing in land abroad.

    Tom, I have an Italian lawyer who is dealing with the purchase of the property etc. However, my two friends are Irish. Should I, as someone else has suggested to me, draw up a separate will (in Italy) which deals only with the Italian property? I had thought that an Irish will should cover all assets, irregardless of where they are located.

    However, neither of the friends involved would, in normal circumstances, be beneficiaries of my will. The main concern is that they would be repaid any outstanding loan before the main beneficiary (I am not married/do not have children, so this is a niece) inherited from my estate.


  • #6
    seamus
    Registered Users, Registered Users 2 Posts: 68,317 ✭✭✭✭seamus


    Please talk to a solicitor. Asking for or giving legal advice is not allowed on this forum.


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