Im building a granny flat on the side of my mothers house.stamp duty?

R

ricod

Guest
We have an option of selling our house and taking over my mothers mortgage.We would move in to her existing house and then we would build her a 2 bed house on the side.
Would we have to pay stamp duty?
 
A few confusing aspects to this.

How do you "take over " her mortgage? Do you mean pay off her mortgage? Are you buying her house in which case you would pay stamp duty.
Or does the house stay in her name? How do you fund the granny flat? Who has title to what?

Tell us who is own what and how it will be funded.

mf
 
hi,well we would be getting a mortgage to 1. pay off what she owes and 2.the money to build the granny flat.The house would be going into our name.
 
So, you want to buy your mothers house from her. You will get a mortgage to enable you to do that. Out of the proceeds of the sale, she will discharge her mortgage. It does not sound as if you are paying her market value for the property.

You can only raise a mortgage on a property that you own. So you have to buy her property from her to get a mortgage.

So, yes, you will pay stamp duty.

mf
 
Thanks MF

I will be getting a mortgage of 200 thousand,this will cover her mortgage and fund the build etc.
The house is now worth around 450,000
Will the stamp duty be at the market value of the house at the moment.
Do you know at what rate the stamp duty.Is it slighty less for family.ta
 
"Will the stamp duty be at the market value of the house at the moment."

Yes.

"Do you know at what rate the stamp duty."
7% for anything above 125K

"Is it slightly less for family"

Half.

Approx. 11K stamp duty but only if it is from mother to child - not if there is anyone else on the title

You really should talk this through with a solicitor. Your mother also should talk to her own solicitor to see if it is a sensible and wise approach to take.

mf
 
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