Jerseygirl64
Registered User
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- 16
I have 2 siblings - one who has a profound disability and in full time care - another reason for my relocation - to be closer to help out with regular visits to sibling@Jerseygirl64
Question: are you an only child, or do you have siblings?
My mum has savings accumulated and has offered to loan me the 60k
Not if she only has 60k?Can I borrow 70K from my mother
The reason I asked is tax is the easy bit. It's the potential arguing over inheritance if anything happened your mum that causes complications down the road.I have 2 siblings
I don't know her total savings but she said she has alot more than 60kNot if she only has 60k?
You already received a gift worth 320K. From your dad. And now you want to borrow your mother's savings.My Dad gifted me the home I was living in with my wife and children by deed of transfer. It was valued at 320k. Unfortunately my Dad died 18 months later and we have sold our home so we can be closer to my mum.
Using proceeds of the sale of our home along with some savings, we are falling short by about 60k to purchase a new home. (We had to spend 40k on renovations to our home before we could sell it but the improvements made yielded a much higher sale price than it would had we not spent it). However, now applying for a mortgage and the bank are querying all of the spending (new kitchen, new bathroom, labour costs) - money that came from savings used to make home saleable
My mum has savings accumulated and has offered to loan me the 60k instead of a bank - I would repay this back to her by 1,000e per month but would like advice on how/who we'd get to draw up an agreement so that it is all above board legally and for Revenue, tax etc - what interest rate would she need to apply if we did this?
And even then it doesn't have to be a long document. Just the agreement between the two of you on the amount being borrowed, the agreed repayments and the interest being paid. Even if 0%, put will be repaid at 0% interest.Guys
You are overthinking this.
The OP is borrowing €70k over 6 years from his mother instead of taking a mortgage from the bank.
It is eminently sensible as the mother has plenty more money.
It happens all the time that parents help their children to buy houses, even if in this case, they have already received a gift of a house.
The only issue is documenting it as Red has suggested.
Brendan
It's completely unnecessary.For the best way to document it, am I right to think it best for mum to run this past her solicitor and have him witness our loan agreement
Bronte's advice though makes me think its wrong to accept her offer though because my sibling won't know about it - sibling didnt get a 320k gift but will be inheriting the family home and its current market value is 700k
Absolutely not overthinking this. My reply is based on life experience. And on what I've read on here and elsewhere. The point of on here is to try and give our best opinion or advise.Guys
You are overthinking this.
Based on this my further comments are:yes - my mum wants to loan me the money and cut out the need for a mortgage - I'd borrow 60k and repay 1,250e per month so it is repaid in 4 years - Bronte's advice though makes me think its wrong to accept her offer though because my sibling won't know about it - sibling didnt get a 320k gift but will be inheriting the family home and its current market value is 700k
For the best way to document it, am I right to think it best for mum to run this past her solicitor and have him witness our loan agreement - monthly transfers would be made to her account then - I'd try to repay her sooner aswell if I can get a credit union loan to clear balance for her & from then repay the CU instead - this is preferable to me than borrowing for 20 years from a bank
Target house price is 450/460k and to rent that type of house is c2k per month -
Well I don't think I'm wrong to point out things. Because things have a habit of going wrong.Bronte is just wrong.
It is much better when you want a comparatively small amount of money to borrow it from the family.
Your mother is probably getting 0% interest and you will be paying about 4.5%.
And no need for the credit union either.
By all means tell your sibling if you wish. Your mother's financial affairs should be private and if she wishes to tell your sibling, let her do so.
You are talking about a €70k loan when the two of you are getting gifts and inheritances worth over €1m. It's just not important.
Brendan
Thanks and I value all opinions - sibling is not being told as that is my mum's decision - sibling will also look for a loan, substantially larger and going on previous performance, he's not good at repaying family loans - he still owes me 3k and I've been waiting a couple of years for it nowBased on this my further comments are:
- why has your sibling not been informed
- I have not said it is wrong to borrow the money. But I advise full transparency
- Why would one sibling inherit the family home
- Nobody can rely on a promise of a family home in the future, that would be pretty stupid
- Why would you get 320K and sibling 700K (which is way over the tax free amount, so that's bad financial planning - unless it's a farm)
- If it's a farm, then it's a different matter. One child gets a house and the other the farm.
- A solicitor giving your mother independent advice on this might be a good idea, but it's not a lot of money, so if your mother is happy enough I don't see an issue other than the sibling not being told. Certainly your mother should have the agreement in writing.
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