How to transfer Title from parent to children?

[Pesty]

As the title suggests, my mother can no longer manage the home she owns (parents divorced many years ago, Dad signed the house over to her). It's very rundown and not safely livable, as Mum is a Disabled Pensioner, she is financially burdened by the house and also in poor health. The family have asked my brother, sister and I to take responsibility for the house and Mum wants the house to go to us as well. How do we go about the legalities of transferring the Title to us children so the Sheriff doesn't end up with Mums house? We are also looking at being appointed her Power of Attorney as there are other issues at hand that I won't go into on here. There is no mortgage on the home.

Many thanks!

 

[alexlee]

Have you discussed with your siblings what you intend to do with the house? If maintain it, how much are you all willing to spend? Who contributes how much? What happens if one sibling can't or won't contribute their share? What happens in the future? Do you keep the property? Sell it? Given that you'll each own a third, are you willing for any of you to take a mortgage out against their share to fund personal expenses or investments, knowing that this puts the property at risk? Say in the future your mother goes into a retirement home, or needs money for medical expenses. What's the plan? Sell the house? Keep it and borrow against it?

You get the idea.

 

[redwing]

Family Agreements seem interesting on face value IF all goes well.

There has to be a *smart* and beneficial way for all parties involved to resolve this reoccurring issue

 

[nww]

Transferring the property from her name could also affect her future pension
This will also go against her for the next 7 years if she has to find a high dependency accommodation.
The government will calculate this as a sale at the current market value and
still class this monetary value as being hers.
So the children may be required to fund her accommodation for some time.
You should contact the government seniors department for advice.

 

[pennyk]

As NWW says, you need to tread carefully and get some legal advice, because the risk to her is that she will still be assessed as owning the house.

Where are you planning for her to live? If she is going into something like a low care residential facility, you will need to pay a deposit bond, or at least the interest on the deposit bond, as well as the regular ongoing fees. There are ways to manage the PPOR which can make this much easier to manage without having to sell the house.

So, I wouldn't proceed unless you have really got a clear plan for your mum's future accommodation needs.

cheers Pen

 

[Terryw]

I agree with the others. Careful planning and good advice is needed as there are many issues involved:
- social security/pensions
- estate planning
- litigation/bankruptcy????
- taxation (it may be best left in mum's name with you guys loaning or gifting money)

If you do want to just transfer title you would just need a valuation and fill in a transfer form and pay the stamp duty.

 

[redwing]

I agree with the others. Careful planning and good advice is needed as there are many issues involved:
- social security/pensions
- estate planning
- litigation/bankruptcy????
- taxation (it may be best left in mum's name with you guys loaning or gifting money)

If you do want to just transfer title you would just need a valuation and fill in a transfer form and pay the stamp duty.

WOW...Just had a look at what that would be today on the parents property in WA at curent val's..Stamp Duty would be around the $84k mark

 

[Perp]

From reading between the lines, I gather your Mum has built up significant non-mortgage debts and is in danger of losing the house. Just be aware that if this is the case, gifting the property into your names (the kids) would be viewed as an attempt to defraud the creditors. Therefore, you could end up: 1) not achieving your purpose of protecting the house as the transaction could be "undone" anyway, and 2) Mum would likely face criminal charges relating to the fraud/attempted fraud.

That's on top of all the other reasons why it's a bad idea.

 

[s.w.i.s]

Is there a way to get around the stamp duty payment if the child allows the parents to live in the home for free of charge after the parent transfers the title of their home to their children?

 

[marg4000]

Is there a way to get around the stamp duty payment if the child allows the parents to live in the home for free of charge after the parent transfers the title of their home to their children?

This varies from state to state. I know some states do not charge stamp duty for property transfers between relatives where no money changes hands.
Marg

 

[s.w.i.s]

Thanks! The property in question is in Victoria. Does this help?

Also is there someone we can call to find out?

 

[Terryw]

Thanks! The property in question is in Victoria. Does this help?

Also is there someone we can call to find out?

I would say there are probably no exemptions of the kind you mentioned, but you could try asking the office of state revenue and/or looking up the Duties Act for Victoria.

 

[s.w.i.s]

Thank you all for your suggestions.

Merry Xmas and a happy New Year!!!!!

 

[wobbycarly]

This varies from state to state. I know some states do not charge stamp duty for property transfers between relatives where no money changes hands.
Marg

Thanks! The property in question is in Victoria. Does this help?

Also is there someone we can call to find out?

Stamp duty exemptions in Victoria are only if the transfer is between spouses.

 

[s.w.i.s]

Thanks Rob!!