D
Dave10
Guest
Hi,
My mother has money tucked away from an inheritance and a thirty something year old daughter still living at home in a big house. My mother wants to loan my sister the money to buy her own place, so my mother can then downsize.
They've both decided that this should be on commercial(ish) terms and that the loan from my mother will be secured by a mortgage on my sisters new home. Repayments will be in line with a mortgage from a bank (principal and interest).
My question is, could my sister get mortgage interest tax relief on her repayments to my mother? I know it's usually dealt with by relief at source through the lender but not sure how this could work as my mother is obviously not a bank! I've read up on this an it would seem to meet the requirements for a secured loan to buy a principal private residence, would my sister be able to claim the relief at year end from the Revenue?
The reason I'm asking is that it might make more sense for my mother to just guarantee a mortgage for my sister, but my mother likes the idea of getting a bit of money out of the bank and into something else to diversify (times being as they are!)
Thanks!
My mother has money tucked away from an inheritance and a thirty something year old daughter still living at home in a big house. My mother wants to loan my sister the money to buy her own place, so my mother can then downsize.
They've both decided that this should be on commercial(ish) terms and that the loan from my mother will be secured by a mortgage on my sisters new home. Repayments will be in line with a mortgage from a bank (principal and interest).
My question is, could my sister get mortgage interest tax relief on her repayments to my mother? I know it's usually dealt with by relief at source through the lender but not sure how this could work as my mother is obviously not a bank! I've read up on this an it would seem to meet the requirements for a secured loan to buy a principal private residence, would my sister be able to claim the relief at year end from the Revenue?
The reason I'm asking is that it might make more sense for my mother to just guarantee a mortgage for my sister, but my mother likes the idea of getting a bit of money out of the bank and into something else to diversify (times being as they are!)
Thanks!