- January 16, 2024
- Posted by: legaleseblogger
- Category: Related News
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Investment into Property and Family Dispute
Investment Details
I have recently invested a substantial amount of money into a property, gifting my son £80,000 and also contributing £20,000 towards the renovation of the house. To cover his half of the property, my son took out a mortgage. The intention was to share the house for a period of 5 years, during which time my son had a fixed mortgage plan. The plan was to then sell the house, allowing me to recover my initial investment, and thereafter we would split the profit 50/50. Unfortunately, I did not have any of this agreement in writing; all I have are bank statements.
Current Situation
I have been splitting my time between the property and Spain, during which my younger son has moved into my bedroom and has been paying rent to my son. Now, my son has a girlfriend and is demanding that my younger son moves out, and she moves in. He also expects that all my belongings be removed from the property. I have agreed to this, but I would like some rent for my half of the property. This suggestion has not been received well by my son.
Other Sons
I have three other sons who have not benefited from any financial assistance. This situation has left me questioning whether I am justified in asking for rent on my half of the property.
How AI Legalese Decoder can help
AI Legalese Decoder can assist in this situation by helping to outline and formalize the initial investment agreement between you and your son. By generating legal documents, the AI Legalese Decoder can help you to clearly define the terms of your investment and the intended profit-sharing agreement. Furthermore, it can provide legal clarity on your rights to request rent for your portion of the property, taking into account the financial support you have provided to your son and the potential impact on your other children. This could help to mitigate the family dispute and provide a clear legal framework for moving forward with the property arrangement.
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****** just grabbed a
I assume you signed a form to say that the money was a gift and that you accept you will not have ownership of any part of the house? This would normally be a requirement of your son’s mortgage.
If so, the question you are asking is if you can claim back money that you used to create a fraudulent mortgage application with your son.
You can ask, but you have no legal recourse.
When you say there’s nothing in writing, does that presumably mean that your son is the sole owner on paper?
Then legally, you’re entitled to nothing for that 80k. The reason the bank made you sign a letter stating that the ┬ú80,000 was a gift, was specifically to avoid this situation of you claiming partial ownership of the house.
Only angle I can see here is that ┬ú20,000 (you said to “reform” the house, do you mean renovate?) Basically, if you can establish tenancy, i.e. that you lived there, and that you contributed significantly to the value of the house by either paying the mortgage or paying for rennovations/upkeep, you MIGHT have a route to claim some equity, but you’ll need a solicitor to even think about going that route. I don’t even know if it would work.
It was a gift. You do not own any part of that house.
Classic.
Here is this “gift” son. Just lie to the mortgage company and tell them that I don’t expect to have any ownership of the house.
What do you mean I don’t own anything?
Surprised Pikachu face.
> I have invested money into a property. I gifted my son £80,000 and paid £20,000 to reform the house
Just so we are clear, your son bought a property (is his name on it and only his name), and you paid 20k to renovate it? Part of the down-payment on the property was your 80k that you gifted to your son?
If all of that is true, then you have no legal right over the property. As others have said, you have the possibility to recoup some of the 20k but it’s highly unlikely you would get anything back. By all accounts, it’s your son’s property regardless of where the money came from or who paid for what work.
“…this is what we had to do” No, it is not. Now you know why.
We’ve given some money (not 80k) to my step-daughter so they could get together a deposit. Had to sign it as a gift, did the same for my daughter some years previously. They may choose to see it as a loan but you like me signed it over as a gift, there’s no expectation of it coming back.
Just to clear this up – you gifted your son ┬ú80k to put towards his ┬ú160k house, which allowed him to get a 50% LTV mortgage, then paid ┬ú20k to renovate it (likely increasing the value & equity) – but didn’t go down as a joint applicant or on the deeds?
Or do you mean that you own 50% of the property on paper, but your son had to mortgage his half of, but you paid cash?
The two scenarios are light-years apart in terms of any potential recourse you might have…
ÔÇÿThinksÔÇÖ heÔÇÖs entitled? Sounds like heÔÇÖs got the paperwork to back it up.
The username checks out
This is one of the downsides of the type of mortgage fraud you have committed. You have no legal recourse to enforce your illegal agreement.
Bottom line – legally you gifted the 80k (100k?).
The mortgage and house is in his name.
If you try and prove that the “gift” was not actually a gift then you’ll be done for lying.
You have no legal recourse without fucking yourself.
Sort it out with your son.
I was once going to lend a friend IÔÇÖd known for 15 years ┬ú75,000 to enable her to move house. It was my motherÔÇÖs money that she got when I sold her house as she was diagnosed with dementia and in a care home. I thought I knew this woman so well and I trusted her to pay me back. I had lent her money in the past and she had repaid it so I wasnÔÇÖt worried. When we went to the estate agents to discuss the sale they asked if it was a loan or gift. I said gift as I didnÔÇÖt want them involved. But later in the day I heard her telling everybody that I was gifting the money and that started to bother me.
Days later I had a text of her saying that if I had changed my mind about lending her the money then it was okay as she didnÔÇÖt want it to come between us. Well it turned out she was furious with me and I have since found out that sheÔÇÖs conned lots of people out of money, even her own brother! Needless to say IÔÇÖm so glad I had changed my mind as she got sacked from her job and hadnÔÇÖt worked since! So glad that was a bullet IÔÇÖd dodged! IÔÇÖve learned that you need to have thing down on paper and always protect yourself no matter who youÔÇÖre dealing with.
>The gift was not a gift but for the bank, this is what we had to do.
NAL but my understanding is that the gift was indeed a gift. Because if it was not a gift, then you’d have committed fraud.
Either way, I’ve a feeling you have no recourse. Because you were playing games with the deposit and it’s come to bite you.
Which part of the house do you actually own? Is your name on the deeds? If not, then you donÔÇÖt own any part of the house.
The gifted deposit form, which stated the money was a gift and that you donÔÇÖt have any stake in the property, isnÔÇÖt just something you had to do for the bank. By declaring this as a gift and not a loan, you and your son committed mortgage fraud.
In addition to the correct answers of other users, the best solution in these cases is often to handle the matter in your will. For instance you can either disinherit your son entirely, or deduct the £80k + whatever you expected to earn from his part of the estate.
This sort of a solution allows you to ÔÇÿpunishÔÇÖ your sonÔÇÖs bad faith but also saves you the thousands you would need to pay if you sought to undertake (in my opinion very unlikely to succeed) litigation.
I guess the simple question is, is your name in the deeds?
I’m puzzled OP. Is your name on the mortgage or the title? If not sounds like you’ve shot yourself in the foot. How will you even be able to charge your son rent if you have nothing in writing. If you told the mortgage company the 80k was a gift but you still expect to get it back when the property is sold then saying it was a gift was obviously a lie and would be considered fraud. I also wonder how you brought your children up if one of them is prepared to ignore any verbal discussions you had about the property and is now claiming 100% is his without any recourse to you.
He doesnÔÇÖt think heÔÇÖs entitled, he is entitled to it. You canÔÇÖt ÔÇ£giftÔÇØ money and then expect it back under the eyes of the law.
You could potentially fight for the renovation costs as this gives you a beneficial interest but youÔÇÖd have to go to court. Personally if you donÔÇÖt live there and the son can show you gifted the deposit with a signed gift declaration he could also claim the renovations were clearly a gift too. And itÔÇÖll cost a reasonable sum to take it to court.
You canÔÇÖt use any evidence of your claim he owes you the deposit or youÔÇÖve committed mortgage fraud. You also likely committed other forms of fraud – if he was a first time buyer and got reduced SLT, fraud. If you owned another UK property at the time youÔÇÖd need to pay extra SLT so again, fraud. Going and declaring all this in a court will not go well for you.
YouÔÇÖre wrong for asking rent on your half of a house you donÔÇÖt own. You literally canÔÇÖt demand rent as legally you have no entitlement to it.
Your son IS entitled to the house because according to the paperwork the 80k was a gifted deposit. Play stupid games get stupid prizes.
You havenÔÇÖt ÔÇ£investedÔÇØ any money – youÔÇÖve given your son ┬ú100k towards buying and renovating his house. The mortgage company has a charge over the property, but you do not. If you die within 7 years he will potentially pay tax on your gift to him, depending on your estateÔÇÖs exposure to IHT, as it will be counted as part of your estate (there is taper relief however). HeÔÇÖs legally entitled to keep all the profits after he sells the house and repays the mortgage. If he opts to abide by your unwritten agreement – which constitutes mortgage fraud, by the way – and gives you a portion of the profit, this will be a second gift for tax purposes and would be pulled back into his estate if he died within 7 years of the transfer, potentially rendering it liable to IHT depending on his other assets.
Edited to add: far from requiring your sonÔÇÖs girlfriend to pay you rent for a house you donÔÇÖt own, your son is within his rights to ask for rent from you if youÔÇÖre keeping a bedroom and storing goods in his house.
Morally, your son should compensate you in the spirit of the original agreement.
Legally, the house belongs to him and he can do what he wants with it.
NAL but by the sound of it, you’re up a creek without a paddle.
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If your name is not on the property deeds as co-owner, you donÔÇÖt have any legal claim on the house. If you give someone money to pay for a deposit, you have to sign a letter saying the money is a gift and you have to give a copy of your bank statement to prove the money has come from there. This means that you cannot expect any payback from this arrangement.
Yes you are legally wrong. You didn’t invest. He does not have to give you any money for rent. He also does not have to return your 80k.
Did you not have to sign a letter stating this money was a gift for your son to get his mortgage approved? In which case the house will be in his name and his property.
You havenÔÇÖt bought a house together. You gifted him a large sum of money so he can buy the property.
If your son decides to not pay you back you are screwed to the tune of ┬ú100k and you already pissed the other sons off by favouring and giving a monumental hand up to the first. You would have been better of saying they all had ┬ú30k each and treating them equallyÔǪ
Sounds to me like you “gift” was actually used as deposit and son then got mortgage fir rest. Because you signed paperwork yo claim it was a gift in the eyes of the law you assisted your son with a deposit and he bought the house, you have no claim to it at all.
> The gift was not a gift but for the bank, this is what we had to do.
No, you didnÔÇÖt and you shouldnÔÇÖt have done. Try telling the bank that thatÔÇÖs what you did and youÔÇÖll be in real big trouble.
If the contribution wasnÔÇÖt actually a gift and you signed legally binding documents to state that it was, you committed mortgage fraud. Reap what you sow. You have no legal recourse. The money is not yours now and neither is any of the house.
> I have nothing in writing
Well, no, of course you donÔÇÖt; because you went about this the ÔÇÿeasyÔÇÖ way (the illegal way).
If you wanted a share in the house, you should have gone for Tenants in Common and had contracts drawn up. ThatÔÇÖs the legal way to do it.
> Am I in the wrong asking for rent on my half of the house?
Yes, because you donÔÇÖt own any of the house.
ThatÔÇÖs not an investment. You gave away 100k and it sounds like your son wonÔÇÖt be paying it back. He is also not under any obligation to sell the property after 5 years. Sorry. You can write him out of your will if youÔÇÖre concerned about fairness to the others.
I think itÔÇÖs easier if you can tell us, what evidence do you have (in black and white) that proves you have any ownership of this property?
Your in the wrong really. You defrauded the mortgage company by taking a mortgage out in his name and declaring the 80,000 as a gift which it was not.
This is fraud, Id speak nicely to your son about this or kiss the money goodbye. You have zero legal recourse on this.
He’s within his rights to evict your son and remove your property to answer the main point of the question.
Lying to the bank about your loan being a gift is mortgage fraud and quite serious. NAL but you may want to delete your public confession from reddit.
He is entitled (to an extent), it is his house.
You gifted the money. Whether that was your intention or not, that is what took place so you could fraudulently obtain the mortgage.
He doesn’t actually have to pay rent for anything.
A gift is a gift.
You shouldn’t give to receive my mom always said.
Your son sounds like an utter knob.
However, legally, you have no recourse due to the mortgage fraud you’ve commited. So unless you can sort it out with your son, there’s literally nothing you can do and it doesn’t matter if you’re wrong for asking or not.
If it went to court then soon as the judge sees the letter you signed saying it was a gift the judge will in polite legal terms tell you to spin on it.
If you then say ÔÇ£but your honour I only signed that so my son could get a mortgageÔÇØ the judge will then give you a stare wondering why youÔÇÖre admitting to mortgage fraud in court.
TL;DR
Legally, the money was a gift and you have no recourse. Your only chance of ever seeing a penny of that 80k is praying your son will pay you it back overtime. ThereÔÇÖs a good chance heÔÇÖll say no and then you need to think about how much you push it and whether potentially ruining a relationship with him is worth it.
This people is why we always follow the adage of ÔÇ£donÔÇÖt loan money you arenÔÇÖt willing to lose, especially to familyÔÇØ
If your name is not on the deeds or mortgage then you don’t have any claim to the property.
Your son has pretty much scammed you for an £80,000 deposit that you legally gifted to him.
You can’t get your money back because you signed a document that you gifted him the money.