Joint mortgage & inheritance tax

[samantha.otoole]

Hi, I have a joint mortgage with my dad on the property that we both live at. Due to my dads age he does not have life insurance to cover his share upon his death. So should he pass away, I still have the full mortgage. While there is a mortgage outstanding, will I be liable for any inheritance tax, when my father passes away?

 

[Brendan Burgess]

Who owns the property?
You on your own?
You and your dad equally?

How much is the property worth today?
How much is the mortgage outstanding?

 

[samantha.otoole]

It was my dad's house but was very run down. We therefore jointly got the mortgage to modernise it. The bank have the deeds but my understanding is that it's joint ownership, as the mortgage is in both our names.

We took out a mortgage if 320,000, there is 150,000 outstanding.
The house is currently worth around 500,000.
Many thanks.

 

[jpd]

my understanding is that it's joint ownership, as the mortgage is in both our names.

Not necessarily - the ownership and mortgage are two different items
Did you Dad transfer part of the house to you when you applied for the mortgage?

 

[DannyBoyD]

Check terms of your Dad's will. Ideally it should say property is left to you subject to the mortgage.

IANAL

 

[Brendan Burgess]

You need to talk to the solicitor who handled the mortgage for you at the time.

It sounds as if your father took out a mortgage with your name on it and you have no ownership of the house at all.

Your father could leave it to the Cats and Dogs Home. It would be sold and the mortgage would be cleared from the proceeds.

I would not rely on the will. I would make sure that part ownership is transferred into your name now.