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Mortgage - Is this feasible?

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  • 11-10-2013 12:38pm
    #1
    tbukela
    Registered Users Posts: 375 ✭✭


    Looking for some feedback on whether what I'm proposing is actually feasible with the banks these days.

    My wife & I own a house which is in negative equity. Following discussions with my parents they are agreeable to gifting us their house and we would build them a smaller bungalow on some nearby family land.

    We would sell our current house and have about 50k left to pay on that mortgage. We would then seek to release equity on my parents house which would have been transferred to us to build their new bungalow and carry out remedial work on the old house.

    Notwithstanding borrowing ability, planning permission etc is this a workable idea?


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    #2
    listermint
    Registered Users Posts: 33,931 ✭✭✭✭listermint


    afaik, your parents cant gift you their house, There would be tax involved in relation to inheritance. You need to get proper legal advice on this.

    seek a professional.


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    #3
    tbukela
    Registered Users Posts: 375 ✭✭tbukela


    listermint wrote: »
    afaik, your parents cant gift you their house, There would be tax involved in relation to inheritance. You need to get proper legal advice on this.

    seek a professional.

    I'm aware of gift tax thresholds etc. Why do you say that my parents couldn't gift me the house?
    It's their home with no mortgage on it.
    My query is more on whether banks would allow the release of equity.


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    #4
    D3PO
    Registered Users Posts: 7,879 ✭✭✭D3PO


    tbukela wrote: »
    I'm aware of gift tax thresholds etc. Why do you say that my parents couldn't gift me the house?
    It's their home with no mortgage on it.
    My query is more on whether banks would allow the release of equity.

    they should do. weather they will or not is another question.

    However your equity release would also have to cover the 50k neg equity aswell as any work for building the bungalow and remdial work you have which you didn't mention in your first post.

    Also don't forget that even if their house to you may come under the gift tax threshold you are essentially going to be gifting them back the bungalow and sibling top parent gifts can only be 30k (outside of special circumstances) so there may well be a taxable liability there


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