Swapping house

T

tenifan

Registered User
Messages
6
Hi

My name's Teni.. My dad inherited a house a few years ago from a family member. He decided to rent it out a few years, but now he's looking at selling it. I quite like the house and he's offered me mates rates if I want to buy it.. essentially giving me a nice gift.

I have my own house which has a mortgage. Ignoring tax issues, can anyone tell me the cleanest way to do things.

My (simplified) situation is as follows:
My house value: €100,000. My mortgage €110,000. My dad's house: €150k.

To me, it looks like I should sell my own house for €100k, use the money to buy my dad's house, then assign the new house to the bank, so that I am still left with a €110k mortgage.

An alternative is my dad and I swap houses and get everything sorted out with the solicitor, then leave my dad to sort out the sale of my house. Apart from the hassle of my dad now having to sell me house, it seems it might actually be cleaner to arrange.

Just looking for feedback for anyone who went through a similar process.

Thank you
 
You need to talk to a solicitor. You need to find out what is possible, easily achievable and what is awkward and unnecessarily complex. Swapping houses is awkward unless you pay off the mortgage first. It is also messy insofar as there is no guarantee that the house will sell. And there will be two sets of stamp duty to be paid.

Realistically, you sell your own, clear off the mortgage and apply for a new mortgage to buy the second. Your father may have a CGT liability if the current value is greater than his original purchase price. You may have a CAT liability ( if you have received substantial prior gifts or inheritances).

mf
 
Contact your mortgage provider to ensure that the full mortgage will be transferred to your new house!
 
Appreciate the input
Yep, intend on visiting my solicitor, and as nice as he is, sometimes it's best getting the opinion of someone who's been through the process.
The house swap seems a bit cleaner in the short-term as it means I can take over my dad's house straight away, while my house could easily be rented out at a moment's notice... but it would hit my dad with €1000 stamp duty on taking over my house (which he does not intend on keeping)
 
You can't transfer your house without first either clearing the mortgage or with the lenders permission transferring it to your new house. I.e. This would entail a prior transfer to you of your father's house. Do nothing until you have the bank's permission for any action.
 
You must log in or register to reply here.
Back
Top