Family Assistance with Purchase
Recent reports have highlighted that family assistance with purchases is becoming more and more common and that if assistance is offered a first time buyer can purchase that all important first home years earlier than without
At AIM we can discuss with you the various ways in which you can assist with a purchase by a loved one. You may want to make an outright gift or may wish to ‘loan’ the money and secure this against the property they are purchasing.
Many individuals don’t realise that in order to assist a family member with a purchase they don’t have to give their money away. You may wish to make a gift of the deposit or a larger contribution but there are other factors you may not have considered such as ensuring you treat all family members equally and what would happen if your funds are being used toward a purchase by your loved one and their partner?
A gift is just that and cannot be recovered if the situation your loved one is in changes.
You may wish to think about making a loan rather than providing the funds as an outright gift. The loan can then be secured against the property being purchased as a private mortgage. A formal loan agreement can be prepared by our Corporate Team who we work closely with and then we can draft the charge deed to secure the loan against the property. This option can also offer flexibility with your own estate planning.
It may be worth considering being a co-owner of the property or use a declaration of trust to record your contribution to the purchase or that made to your loved one, though this can have an impact on the level of Stamp Duty Land Tax (England) or Land Transaction Tax (Wales) payable.
At AIM, we have solicitors who are able to advise you in a friendly manner on the technicalities of all the options and help you understand the implications this will have upon your estate and the situation of your loved one.
Our Approach & Our Experience
Our team is recognised as one of the friendliest and most approachable in Manchester whilst at the same time being the market leader in terms of service levels.
We pride ourselves on our practical, no-nonsense approach to what sometimes can be a frustrating process. Our highly efficient residential property team has a wealth of experience and we deliver a bespoke, pro-active service that is responsive to our clients’ needs.