Help With Cash Back

[Gord]

hope you lot can help me here ? my brother owes me 20k from over 10yrs ago(long story) but i have his house in my name :) coz i got morgage for him, get a letter asking me to sign the house over to him (house payed for) now i was wanting to know can i sell the house to get my money back ? if so will i have to pay tax at 42% as it is not my 1st home, its rather a lot of money to lose :duh: we dont get on that well :o and some freinds are telling me to just sell the house get my 20k and give him the rest(ok with me)but not him any ideas ? thanks gordon ps everything is in my name (deeds)been told i can sell ?

[billybandit]

can you not transfer the house in another family members name ie the wife if shes not on your mortgage. then she could sell it and you wouldnt have to pay tax.

just a thought :duh:

[Gord]

can you not transfer the house in another family members name ie the wife if shes not on your mortgage. then she could sell it and you wouldnt have to pay tax.

just a thought :duh:

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yes thought of that but we have other houses that we let out :duh: thanks

[Gord]

dose the other family member have to be over 18rys old ? as i have sons from 7yrs to 16yrs old

[Fargo]

sell the house to your brother.. unless he still cant get a mortgage of course.

[Gord]

he not wanting to give cash back but he could be without home soon playing with fire thinks i wont sell or carnt sell that why ive post this if i can sell then i will, just to get my money back

[johnboy]

does it have to be signed over to a family member, ie can it be signed to someone you can trust, just a thought

[Gord]

yes mate, but the problem there is all my mates have own house and to sell its the 42% tax thing again 2nd home its doing my head in.

[whitie]

Give him the "you have two choices"

1. You give me the 20k back

2. I sell the house, take my money then what ever is left out the 42% tax, i'll think of giving you.

[johnboy]

i dont own a house :D

[Gord]

Give him the "you have two choices"

1. You give me the 20k back

2. I sell the house take, take my money then what ever is left out the 42% tax, i'll think of giving you.

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good one that mate, as its not my problem if i look at it that way will be paying tax out of his money :D i have told him i will sell to get money back, but he says i carnt but i will if i can. thanks

[Kazi]

Give him the "you have two choices"

1. You give me the 20k back

2. I sell the house take, take my money then what ever is left out the 42% tax, i'll think of giving you.

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good one that mate, as its not my problem if i look at it that way will be paying tax out of his money :D i have told him i will sell to get money back, but he says i carnt but i will if i can. thanks

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If the house is in you're name and you have all the deeds etc, you're the one in the driving seat. Have you explained how interest he would normally pay over 10 years with an outstanding debt of £20k??? Sounds like that if you give in and sign the house over to him, you will see nothing and probably not see him again either.

Stand you're ground dude.

[Fidgits]

To be honest, if he wasnt your sibling, you wouldnt have an issue, you would've sold it and taken the tax hit...

If i was you, I'd put it up on the market, once the sign goes up and people start looking around, he'll take you seriously...

if he doesnt, sell it..

[Fargo]

yep, agree with the others now,, sell the house,, stuff the tax anything more you make in the process is a bonus for 20k investement eh..

[Ash 200 Sport]

I'd agree with the others. To sell and take the tax hit via the profits you make. The only issue I would see is that if you do put it on the market you may not want him in the house when buyers come round. As he could give a negative view on it and prevent the buyers from moving with it.

You own the house as all the deeds are in your name. There may be an issue if no formal contracts are in place with regards to his tenancy.

Best talking to a solicitor about that.

[Gord]

I'd agree with the others. To sell and take the tax hit via the profits you make. The only issue I would see is that if you do put it on the market you may not want him in the house when buyers come round. As he could give a negative view on it and prevent the buyers from moving with it.

You own the house as all the deeds are in your name.  There may be an issue if no formal contracts are in place with regards to his tenancy.

Best talking to a solicitor about that.

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Anyone know a good solicitor around manchester area that can help with this

[T7RY B]

If you only want your 20K back then sell it! Who gives a sh@t what the tax is if you are giving him the balance.He takes the loss. You are standing the loss of no interest for years so you are still doing him a favour.

His best bet is buying the house from you at a low price i.e. under the stamp duty threshold.

He has to be a mug not to buy. But like the other guys say you are in the driving seat and if he doesn't play ball he could end up with SFA.

Terry

[Gord]

If you only want your 20K back then sell it! Who gives a sh@t what the tax is if you are giving him the balance.He takes the loss. You are standing the loss of no interest for years so you are still doing him a favour.

His best bet is buying the house from you at a low price i.e. under the stamp duty threshold.

He has to be a mug not to buy. But like the other guys say you are in the driving seat and if he doesn't play ball he could end up with SFA.

Terry

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thanks lads, i will be selling then as he say no to 20k back,

[Wosket]

how long has ya bro lived in the house for gord? you may find if he's been living there a while he has more rights than you think.

to sell it you will have to evict him first i should think, as part of the sale agreement will be vacant posession for the new owners. i might be wrong but all needs considering, i think you need a good lawyer mate.

[Fargo]

So 'lads' have not replied conclusively, i assume this is why this has ended up at my girlie desk

Land law is messy business, despite the fact you're the one hundred per cent legal owner of the land, legal ownership does not have intrinsic value automatically. You are not necessarily the one hundred per cent equitable owner (the equity being the value, but you own houses so you know that).

How you solve this problem will depend on exactly what arrangement you have with your brother with regard to his tenancy at the property and as a rule of thumb, the less formal that arrangement, the harder it will be so resolve.

A formal tenancy can be severed according to the terms in the tenancy 'contract', but a tenancy by estoppel (promise) can result in wrangling circular arguments over who said what and when, especially as there's probably no evidence to support any of it.

Going on what i can see so far, you have an informal arrangement, whereby you hold the legal title to the property and have contributed 20k to the purchase price of the house. Your brother is a tenant and if he has been paying the mortgage since may 'own' a sizeable proportion of the equity, making it difficult for you to force the issue in any direction.

Oh and the mortgage lenders own a big chunk of the equity too.

On the positive side, you should be taxed in relation to your equitable ownership rather than your legal ownership.

My instinct tells me that this is more personal than legal or financial and as a result it will be difficult to find a legal or financial answer that satisfies all aspects of this personal problem. I think you stand to get 20k and a load of grief, but if your getting grief now anyway then maybe forcing 20k out of him would alleviate that. On the other hand there will be legal fees to pay while all this is sorted out and the lack of formality could take a while to sort out.

So in true lawyer style i haven't really answered at all.

Now about my fee.....

Mrs Fargo

[Fargo]

There were posts while i typed, fortunately we seem in agreement so i will just add that evictions relating to informal tenancies can take and have taken years.

I'm tempted to go look up a case of a rather elderly Mrs Rose who ended up with a tenancy for life despite being subjected to many years of legal attacks from the big business that legally owned the property

You are entitled to see that 20 k loan repaid, hold out for that, but try a direct suit against him for that sum. I would use the house sale as a last resort, just for the sake of your own sanity.

If possible keep me updatd as I have very little evidence here and I'm curious to know how this one pans out.

Mrs Fargo again (free of charge this time lol)

[Anees]

My sister is in her final year studying law at university.

She said you can borrow one of her legal text books Gordon! :D

More seriously however, her thoughts (without really having a lot to go on) are as follows:

(Let it be said that most of what follows doesn't really mean much to me! :D )

"

A way you could get around this is by setting up a trust fund. You said your oldest child was 16 years old. You could set up a trust for your son so when he turns 18 the house automatically go to him so the title deeds would pass over to him at 18.

Any solicitor will help you set up a trust fund.

Once the trust is set up, you could sell the house as the holder of the trust but then you would have to still hold the money on trust for your son until he was 18.

In order to stop your brother having any interest in the house and trying to prevent you from selling it you should have two trustees; maybe you and your wife or good friend as this would negate the legal principle of ‘overreaching’. This means when the house is sold if two people sign the contracts as trustees then your brother’s interests are basically not important.

I am not sure about this but by holding it on trust then selling it as a trustee you maybe able to avoid the tax as the house is not for your benefit.

More of a solution that could take a while before you gets the money.

Alternatively, make a will and in it order the sale of the house and the money to go to your wife, then fake your death and move to Spain. Execute the will and keep all the money as well as enjoying the sunshine in Spain. (JOKING )

If the 20K was your only input into the house then if you get the house valued now it is worth more than when you bought it you will be entitled to a bigger share of the profits when you sell it. The money you get should be proportionate to the money you put depending on the increase in value of the house.

A lot does depend on how your brother is living there:

Did he pay the mortgage?

Is he paying you rent?

Since the house is paid for he may have rights as a squatter if has lived there for 10 years without paying anything except the bills.

Even better take some good photos of the house and enter it into an auction, one of those where you don’t necessary have to view and then sell it there. Then you don’t have to worry about your brother, the new owners can deal with him as long as he has not registered that he has an equitable interest in the house at the Land Registry Office in London.

Still does not answer your question properly.

Any solicitor can help you in this area, but shop around and ask a few as the rate will vary considerably.

"

I hope that is of some help mate

PS Since she is a student she is MUCH cheaper (free) then the highly qualified Mrs Fargo! :D

[Fargo]

missus fargo has just passed here hons degree, so is not as qualified as a full blown solicitor, But reading both views, the main problem with selling the house, would be that he is a living there and you cant get rid of a tenent simply by selling the property..

anyways i'll let the bird explain more, but really we need Gord to give the details of any arrangements made with regards the money lent, him living at the house, who pays the mortgage etc..

[Fargo]

Anees

got giggles at 'highly qualified', very relieved it comes across like that, i'd like to wish your sister all the best in her final year, it's a recent and very painful memory, but there is life the other side of it and i have become slightly more human since finishing it. i spent the whole of that final year wishing i'd done an art degree instead, art students never left the pub, law students never leave the books, they should warn you about that at the outset.

your sister is spot on in approach, so are her conclusions, i appreciate someone else who's studied it pitching in, i need the feedback for reassurance that i'm not talking out of my a##e

i'd dismissed overreaching as an option as there should already be a trust of land with the brother being on of those trustees, our gord can only create a trust over his own equitable interest in that trust, which would seem to be that 20k and no more (but it's been a very long day and i could have the wrong end f the stick now, it could be a totally different stick altogether

and i think i'd decided the brother had an overriding interest, but i can remember having some doubts about that and having a cup of tea instead of researching it further (you pay me i try much harder, honestly)

adverse possession (10/12 year thing) i'd dismissed as i assume that gord's dispute has been going on for a while and that there would be sufficient notice as a result to undermine such a claim by the brother, but you're right we don't know that

we need more of the facts gord and we just dont expect you to publish those on the net

you should be able to get an hour of a solicitor's time for around thirty quid if its an initial consultation, after that sky is limit

Mrs Fargo (getting cheaper by the minute)(story of my life)

[Gord]

house all payed for, his house in my name he owes my 20k no rent being payed, he wants house in his name, not until he pays up, he started the ball rolling but wont pay up i just want 20k back now as its been to long, and i need ways of doing that. thanks mrs fargo + Anees