Buying portion of parents inherited houseq

[Bhelpful]

Hi all,


My parents recently inherited my grandfathers house. They live in their own home that’s fully paid off, and rent out my grandfathers house to us for very little. My grandfathers house is completely paid off as well. My husband and I are interested in buying a 20% portion of it to give them some equity for their retirement. My parents have no mortgage on either home and they are both retired.

Would it be possible to take a mortgage on 20% of the house value? What would be the implications for my parents?

Thanks for any insight you can give us!

[bd6759]

Speak with a mortgage broker. It can be done.

Your parents might have to pay some CGT. But this can be mitigated. Speak with a tax advisor re creating a settlement. That way residence relief will be due to the trustees.

[AGoodman]

If you need to take out the mortgage against grandfather's house, it would probably mean your parents co-signing the mortgage so they would be jointly liable. You could cover all the payments and indemnify them but they would have to be on the hook while they remain legal owners of the property.