Does this donation bring advantages or disadvantages?

Hello,

my girlfriend would receive her parental home as a gift, together with her two other siblings.

The house is valued at ~60k and the debts amount to ~70k (I don’t know why either).

One sibling is only 11 years old, my girlfriend and the other sister are already over 18 years old.

How does the whole process work? In principle, the mortgage is also transferred and all three “new” owners are thus indebted, or not?

On paper, the parents keep the loan and want to continue paying it. (if possible, they haven’t been to the bank yet)

What happens if they can no longer make payments, do the children then have to cover it as owners?

What problems or advantages and disadvantages arise from this?

We want to build in 3 years and we both have to sign for the financing of our house then.

Thanks in advance for your help.

Regards MichiQM

[Laienantwort] You can also simply gift the house - but you have to tell the bank about it - there will then simply be a mortgage registered. The loan continues to run in the parents' name. If the parents do not repay, the house will be foreclosed. As the new owner, you are not immediately the debtor. The loan can be transferred - but the bank will not agree in your case.

For me, the question arises: Why should the house be given away? What do the involved persons want to achieve with it?

Do the parents want to continue living in the house? If yes, is the house really worth only 60K€ or is it worth 60K€ after deducting a lifelong right of residence? That could make a huge difference, especially if the parents are not that old yet. There might be a tax advantage in that, although the house should not be worth so much that, in the worst case, as a child you exceed the inheritance tax limits, especially if you divide the value of the house among 3 children. Perhaps you also want to eventually involve the children in repair/renovation measures, because although they can afford the payments from their pension, they cannot afford the cost of renovation.

Gift of the house with mortgages to minors? Is that legally possible at all? In my opinion, it shouldn't be that simple.

Gift of the house with land charges to minors? Is that legally even possible? In my opinion, it shouldn't be that easy.

To transfer the loan is not possible to my knowledge. Regarding the land charge, I am also not sure, because the land charge is primarily not a liability. It would then only be an encumbrance in the land register like a registered lifelong right of residence.