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Aston Lawyer
Aston Lawyer, Solicitor
Category: Law
Satisfied Customers: 10585
Experience:  Solicitor LLB (Hons) 23 years of experience in Conveyancing and Property Law
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Can I sell my house to my son for less than the market

Resolved Question:

Can I sell my house to my son for less than the market value? And can I lend him the deposit? I bought the house with a mortgage for him and his family to live in in 2009. He pays rent to cover the repayments. The borrower is aware he lives there.
e.g. house is worth 200k (outstanding mortgage is £95k)
he knows he can get a mortgage for 140K
I can set the price at 160k
I can lend him 20k and once he has got his mortgage he can give me back the 20k
Submitted: 1 year ago.
Category: Law
Expert:  Aston Lawyer replied 1 year ago.

Hi, could you just please clarify exactly how much you would like to receive for the property? Is it £140,000 and you had hoped that your Son can repay you the additional £20,000 at some point in the future? Kind Regards Al

Customer: replied 1 year ago.
I wanted 140k which is what I paid for it. However as he has no deposit I was hoping to lend him 20k deposit so I would want to set the asking price at 160k for the house in order to get my 20k back. Hope that makes sense!
Customer: replied 1 year ago.
The house is worth 200 now do there is plenty of equity
Expert:  Aston Lawyer replied 1 year ago.

Hi, apologies for the delay. You will be able to sell to your Son at less than the market value. As your Son would be able to get a Mortgage for 140K, his Bank would normally require this to be the Purchase price. (Although you are "prepared" to sell for 160K, with you giving your Son the 20K, the Bank will normally disregard this additional 20K, as they are only interested in assessing the price on the physical amount of money your Son will be paying). Your Son should therefore apply for a Mortgage on the basis that the Price is 140K and explain that the Purchase is a family arrangement. As he will be buying for less than the market value, the Bank will be happy to lend him 100% of the Purchase price (provided he does of course meet their criteria borrowing 140K. I hope this assists and sets out the legal position. If so, please don't forget to rate my answer. Kind Regards Al

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