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My name is ***** ***** am happy to assist you with your enquiry.
Legally, there is nothing stopping you from buying the property at an undervalue.
The only real risk is that if your sister were to be made bankrupt within 5 years of the transaction, the Trustee in Bankruptcy could make a claim against the property, if he could show that your sister has transferred the property to you in avoid to avoid her creditors.
From your point of view, if you were intending on raising a Mortgage to finance the purchase, your Mortgage Lender would insist on you paying for insurance to cover the above scenario (called a "deed of gift/transaction at an undervalue indemnity policy). This Policy would likely cost approx £300 and would only protect your Mortgage Lender and not you, in the event of the Trustee in Bankruptcy making a claim.
From your sister's point of view,
he only other matter to consider is that for Inhertitance tax purposes, she would be deemed to have given the property away at full market value, and under the Inheritance tax laws, any transactions/assets made within 7 years of a person's death are treated as still being within her Estate when calculating if Inheritance tax is payable. If she were to survive for 7 years after the transaction had gone through, this would not be an issue.
I hope this assists you and set sout the legal position.