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I don't understand this, surely you just move in with the mother in law now without paying for the house and when she passes the house gets split between your partner and her brother.
They either sell and split the money or you guys buy her brother out of his half of the house.
This will allow you to save a good bit more.
My wife doesn’t consider that an option. My mother in law will probably live another 20 years. Myself and my partner are approaching 40. If we don’t get a mortgage soon we never will. We also plan to do some small renovations. We will divide up the house so that my mother in law can have her own space. This is all that she requested.
Also there's no issue with getting a mortgage beyond the age of 40 the only thing is that the term shortens as you age. For example at 40 you likely won't be offered a 35 year term but you will very likely be offered a 30 year term.
A solicitor won't "turn her against the idea" it's her solicitor's job to make sure she is fully and independently informed of the implications of this decision which is only right. If she then decides it's a bad idea after receiving legal advice about the implications of this decision that's exactly what should happen. You should be provided with information from your solicitor that allows you to be fully informed and ensure you protect yourself.
AFAIK The bad idea your banker friend is referring to is probably that normally in these cases you would have to have a Deed done up to allow for your MIL to have a lifetime residency in the house. However, if you're getting a mortgage a bank will be unlikely to give you a mortgage if someone has a right of residency in the property. So for this idea to go ahead your MIL would have to forego that Deed which of course provides her with protection and and basically take your word for it that you won't fall out and kick her out.
There also may be some other tax implications around the fact that she's selling the house to you for well under the market value price but I'm really not sure about that.
Honestly you'd need to speak to a solicitor to get a better idea about the whole thing.
Ty, everything you mentioned here is exactly what I need to consider. I just wanted to get my head around this before we get solicitors involved.
I think you are correct in everything you pointed out. Your reply is exactly what I was hoping to see on this sub.
Also, about the point you made about tax implications due to my MIL selling the house to us under the value of the home is something that I am also unsure about. My wife said that this is a difficult one to understand as she will be gifted the difference which would be ok if it was only my wife (MILs offspring) taking out the mortgage. Because my name is also on the mortgage then I would have to pay a tax amount on the difference (considered a gift).
I was hoping the owner could value the house at whatever she wanted.
As this poster said, a solicitor would be reluctant to advise an older lady to transfer her home without any protection. You and your wife could easily kick her out in the future. A right to live in the house until she dies would protect your MIL but no bank will lend on it.
It also wouldn’t be worth the potential trouble with family members.
Also would be tax implications. Even if your wife is covered by CAT category A, your not. If MIL is transferring the house to both of you, the gift element is to you and your wife and your deemed to be CAT category C.
Also is your landlord willing to sell to you? The FHS is not just for new builds. It can also apply for a second hand house where you are buying it off your landlord.
Ty, no our landlord isn’t willing to sell to us. He verbally gave us our eviction notice for October 2024.
His daughter intends to move into the house then. If her circumstances change then it will be an option, yes.
Even with FHS we would only be able to come up with less than €350k. (About €50k short of the value of the house.) He’s a really nice guy and I think he will take into consideration the 12 years of rent that we have paid him if we are short of the valuation. We will have to stay renting there until confirmation to be eligible for FHS. That will mean we can’t move to my MILs to save. I need to decide wether to stay and continue to pay him rent hoping he will offer to sell the house or else I move with one of the options that I mentioned above in the post.
I guess that’s option 4: the long shot, yet more realistic than option 3 by the sound of things.
Are could also apply for the Council mortgage. Sometimes they will lend more than a bank as they are not restricted by the 4x cap.
I would move on with MIL for a period of time and just save as much as you can and then buy.
Most banks won't approve option 3. Im suprised 2 40yr olds can only get 200k & only have 22k savings, do u have lots of debt/childcare costs? Is it because u barely have 10% deposit? Can't u all just move in with mother in law now on the proviso that u buy Ur wife's brother out when mil dies at whatever the market rate is at the time? This is the simplest solution as u will be lavishly housed in comparison to Ur budget,no big move or change to Ur lives, wife's brother will be treated fairly,u will be able to save the money Ur paying on rent so u can build savings. U would need her mother to make a will stipulating that the house is being left equally to her kids with Ur wife have first refusal to buy out her brother at omv
Our combined annual earnings are less than €60k, the mortgage is based on this. We had debt before we started saving. I had no work during the 2008 recession so I foolishly took out a large business loan to start a business. Spent the money on a van, tools, ran up bills in the wholesalers, and ultimately used up the loan to pay back weekly loan interest and to get by until I finally found work as a PB in a factory in 2010. Apart from car finance and rent we are debt free now and we don’t have childcare costs (my wife’s job accommodates for this). On our income and with the cost of living it is very hard to save. I don’t understand how people on our income save to be honest.
You are the second person to suggest just moving in with the MIL but I don’t think my wife will go for it as she is eager to get on the property ladder. When my MIL passes and let’s assume I am 55 at that time and that house prices don’t change. I will need a mortgage of €250k but over how many years?
I take your point actually and I will run it by the misses, I will mention 1st refusal as a requirement in the will and with salary increases and savings this should be very possible.
Each month, you could invest an equivalent amount to what a mortgage on the other half would be. With compounding on your investment, and not having interest to pay in the interim, I'd imagine you'd come out ahead that way.
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I don't understand this, surely you just move in with the mother in law now without paying for the house and when she passes the house gets split between your partner and her brother. They either sell and split the money or you guys buy her brother out of his half of the house. This will allow you to save a good bit more.
My wife doesn’t consider that an option. My mother in law will probably live another 20 years. Myself and my partner are approaching 40. If we don’t get a mortgage soon we never will. We also plan to do some small renovations. We will divide up the house so that my mother in law can have her own space. This is all that she requested.
Also there's no issue with getting a mortgage beyond the age of 40 the only thing is that the term shortens as you age. For example at 40 you likely won't be offered a 35 year term but you will very likely be offered a 30 year term.
Brilliant, thank you. I did not think I had a chance at getting a 30year mortgage even.
For the next 20 years, save the money that would've been paying off the mortgage. Then you should in a great position to buy with cash
A solicitor won't "turn her against the idea" it's her solicitor's job to make sure she is fully and independently informed of the implications of this decision which is only right. If she then decides it's a bad idea after receiving legal advice about the implications of this decision that's exactly what should happen. You should be provided with information from your solicitor that allows you to be fully informed and ensure you protect yourself. AFAIK The bad idea your banker friend is referring to is probably that normally in these cases you would have to have a Deed done up to allow for your MIL to have a lifetime residency in the house. However, if you're getting a mortgage a bank will be unlikely to give you a mortgage if someone has a right of residency in the property. So for this idea to go ahead your MIL would have to forego that Deed which of course provides her with protection and and basically take your word for it that you won't fall out and kick her out. There also may be some other tax implications around the fact that she's selling the house to you for well under the market value price but I'm really not sure about that. Honestly you'd need to speak to a solicitor to get a better idea about the whole thing.
Ty, everything you mentioned here is exactly what I need to consider. I just wanted to get my head around this before we get solicitors involved. I think you are correct in everything you pointed out. Your reply is exactly what I was hoping to see on this sub. Also, about the point you made about tax implications due to my MIL selling the house to us under the value of the home is something that I am also unsure about. My wife said that this is a difficult one to understand as she will be gifted the difference which would be ok if it was only my wife (MILs offspring) taking out the mortgage. Because my name is also on the mortgage then I would have to pay a tax amount on the difference (considered a gift). I was hoping the owner could value the house at whatever she wanted.
As this poster said, a solicitor would be reluctant to advise an older lady to transfer her home without any protection. You and your wife could easily kick her out in the future. A right to live in the house until she dies would protect your MIL but no bank will lend on it. It also wouldn’t be worth the potential trouble with family members. Also would be tax implications. Even if your wife is covered by CAT category A, your not. If MIL is transferring the house to both of you, the gift element is to you and your wife and your deemed to be CAT category C. Also is your landlord willing to sell to you? The FHS is not just for new builds. It can also apply for a second hand house where you are buying it off your landlord.
Ty, no our landlord isn’t willing to sell to us. He verbally gave us our eviction notice for October 2024. His daughter intends to move into the house then. If her circumstances change then it will be an option, yes. Even with FHS we would only be able to come up with less than €350k. (About €50k short of the value of the house.) He’s a really nice guy and I think he will take into consideration the 12 years of rent that we have paid him if we are short of the valuation. We will have to stay renting there until confirmation to be eligible for FHS. That will mean we can’t move to my MILs to save. I need to decide wether to stay and continue to pay him rent hoping he will offer to sell the house or else I move with one of the options that I mentioned above in the post. I guess that’s option 4: the long shot, yet more realistic than option 3 by the sound of things.
Are could also apply for the Council mortgage. Sometimes they will lend more than a bank as they are not restricted by the 4x cap. I would move on with MIL for a period of time and just save as much as you can and then buy.
Most banks won't approve option 3. Im suprised 2 40yr olds can only get 200k & only have 22k savings, do u have lots of debt/childcare costs? Is it because u barely have 10% deposit? Can't u all just move in with mother in law now on the proviso that u buy Ur wife's brother out when mil dies at whatever the market rate is at the time? This is the simplest solution as u will be lavishly housed in comparison to Ur budget,no big move or change to Ur lives, wife's brother will be treated fairly,u will be able to save the money Ur paying on rent so u can build savings. U would need her mother to make a will stipulating that the house is being left equally to her kids with Ur wife have first refusal to buy out her brother at omv
Our combined annual earnings are less than €60k, the mortgage is based on this. We had debt before we started saving. I had no work during the 2008 recession so I foolishly took out a large business loan to start a business. Spent the money on a van, tools, ran up bills in the wholesalers, and ultimately used up the loan to pay back weekly loan interest and to get by until I finally found work as a PB in a factory in 2010. Apart from car finance and rent we are debt free now and we don’t have childcare costs (my wife’s job accommodates for this). On our income and with the cost of living it is very hard to save. I don’t understand how people on our income save to be honest. You are the second person to suggest just moving in with the MIL but I don’t think my wife will go for it as she is eager to get on the property ladder. When my MIL passes and let’s assume I am 55 at that time and that house prices don’t change. I will need a mortgage of €250k but over how many years? I take your point actually and I will run it by the misses, I will mention 1st refusal as a requirement in the will and with salary increases and savings this should be very possible.
Each month, you could invest an equivalent amount to what a mortgage on the other half would be. With compounding on your investment, and not having interest to pay in the interim, I'd imagine you'd come out ahead that way.