Mortgage/Loans to pay inheritance Tax Bills,do they exist?

J

Jburly1975

Registered User
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4
Hi there

I’m in a rather big pickle and it’s causing me sleepless nights,

My position is this, my grandfather who is in a nursing home wanted me to move into his house a year ago and eventually take the home on his passing, lying empty it was an old but nice house which needed quite a bit of work to make habitable, I took him up on his offer, I invested approx 35000 into the house and have done a lot of the work myself on this house making it now into a decent home.

My problem is this, I was verbally advised that if I live there for three years I may get a tax break so although grandad was in a nursing home he was in decent health and still a strong man, unfortunately last week he had an accident and is now non communicative and not looking good. If he passes on soon I am facing a very big tax bill on this house circa 230,000. I am wracking my brain how i can pay this as I don’t want to lose home and be out on the street. I luckily am in a good job and have no debts or other mortgage.

My question is would a bank consider me for a mortgage or a loan to pay this tax debt as if I was going to bank myself to avail of mortgage at 3.5 times salary I would qualify for 240,000, would this be possible? I do hope so
 
I think they would.

Worst case scenario, you could try talking to Revenue if your grandfather passes away.

Are your parents still alive (and specifically your parent who’s your grandfather’s son or daughter)?

Does your grandfather have other relatives?

And do you know whether his Will confirms what he has verbalised?
 
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Gordon Gekko said:
I think they would.

Worst case scenario, you could try talking to Revenue if your grandfather passes away.

Are your parents still alive (and specifically your parent who’s your grandfather’s son or daughter)?

Does your grandfather have other relatives?

And do you know whether his Will confirms what he has verbalised?
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Gordon thank you very much for the reply, both parents still alive but they are old themselves, I have seen my grandads will and he has named me as sole beneficiary and executor will states property to be left to myself, no other grandchildren.

I’m just really worried as it’s not a straightforward mortgage app and if they say sorry don’t want to go near that I’m screwed with revenue as it’s a huge bill, the only thing i see in my favour is that the property would be worth well above the mortgage amount so good ltv but would they take that into account?
 
If I understand you right you are about to inherit a house which needs a lot of repair, but is worth €750k, which you plan to live in alone.

If this house is in Dublin, it is large and in one of the most fashionable neighbourhoods. If it is outside Dublin it is very large.

Are you sure it would be the best use of your wealth?

You could sell and buy a nice house mortgage free for €500k pretty much anywhere in Ireland.
 
Have you ensured that the €35k you have already put into the house is accounted for properly? Otherwise you are going to pay inheritance tax on your own money.
 
NoRegretsCoyote said:
If I understand you right you are about to inherit a house which needs a lot of repair, but is worth €750k, which you plan to live in alone.

If this house is in Dublin, it is large and in one of the most fashionable neighbourhoods. If it is outside Dublin it is very large.

Are you sure it would be the best use of your wealth?

You could sell and buy a nice house mortgage free for €500k pretty much anywhere in Ireland.
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The house is in Dublin,I hear your points and they are valid however I spent my younger years here and promised my grandfather that it would not be sold,I have a partner and we plan to have a family so it will be fuller eventually all going well. Before I moved in to the house I was looking to get a mortgage somewhere else for a similiar amount of 230000 so I don’t mind paying that as it’s a great opportunity but I’m stuck on if banks would lend in this scenario, I’m at a loss to that as it’s not a standard mortgage application and know banks are much tighter now since the crash.
 
Jburly1975 said:
I’m at a loss to that as it’s not a standard mortgage application and know banks are much tighter now since the crash.
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You should be fine.
Banks tightened up on this type of lending immediately after the crash until about 2015, but it's changed again. They'll want evidence that the money is being used for tax, and a few additional documents, but it should be subject to their normal lending criteria.
 
Jburly1975 said:
Gordon thank you very much for the reply, both parents still alive but they are old themselves, I have seen my grandads will and he has named me as sole beneficiary and executor will states property to be left to myself, no other grandchildren.

I’m just really worried as it’s not a straightforward mortgage app and if they say sorry don’t want to go near that I’m screwed with revenue as it’s a huge bill, the only thing i see in my favour is that the property would be worth well above the mortgage amount so good ltv but would they take that into account?
Click to expand...

You should be fine on that basis. Banks do this kind of stuff, as Red Onion has also said. Hopefully he pulls through though. And if he does and lives for the required period of time, no tax would arise.
 
Jburly1975 said:
The house is in Dublin,I hear your points and they are valid however I spent my younger years here and promised my grandfather that it would not be sold,I have a partner and we plan to have a family so it will be fuller eventually all going well.
Click to expand...

In that case the very best of luck!

It is also worth looking up the dates and deadlines for valuations and payment of the tax. I know there are other threads on that around.
 
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