My husband and I own a flat above our business premises for which we still have a mortgage. We have four grown-up children, two of whom share this flat and pay us rent. With the recent lowering of interest rates the repayments on this mortgage have reduced substantially and we feel now is an opportune time to try to help our children to benefit now rather than wait until we die! The flat is worth between £150,000 and £200,000 (difficult to give a firm estimate). If we sell it to them they may have to pay stamp duty but, more importantly, they will not get a mortgage at the rate we are now paying which is 3.5%. We want to be fair to all four of them. Should we:
A. sell it to them and they raise a joint mortgage.
B. 'gift' it to them.
C. Include them in the mortgage so we are all co-owners.
D Is there a way of setting up a trust or for us to give them a mortgage?
There is also the problem of the two who do not live there and the fairness (or unfairness) of 4 people co-owning but 2 residing and effectively living 'rent-free'. Does anyone have any ideas on how to get round this aspect. Should the 2 who reside pay a nominal 'rent' to the 2 who don't? All advice gratefully received.