Gift of family home, paying out siblings - when to go to the bank?

Hello everyone,

my parents live in a house they built. They want to transfer it at the end of 2023 and continue living in it. In addition to my parents' apartment, the house also has a rented granny flat and a small holiday apartment. It is planned that the house will be transferred to me and my two siblings will be paid out by me.

In order to be able to pay out my siblings, I need a loan. Additionally, investments are needed regarding renovation and heating.

My question now is what requirements must be met in order to agree on a corresponding loan with the bank. Does the house already have to be transferred to me in the land register for this? Or is a (notarized) declaration from my parents regarding the transfer (and the payout of the siblings) on day x (end of 2023) sufficient?

My assumption is that interest rates will continue to rise and that by agreeing with the bank earlier, I may be able to secure slightly lower interest rates.

I am very grateful for your advice.

Best regards

I would also find it very important that a REALISTIC price is found for the house. Often, especially in such situations, "emotional" prices are involved that can sometimes be too high, sometimes too low. I speak from my own experience ...

What is the plan going forward? From when will you be living in the house yourself and where will your parents move to then?

What is the further plan? From when will you be living in the house yourself and where will your parents move to then?

Maybe never ;) That's the kind of arrangement I have.

My parents transferred their house to me because they want to have the most important matters settled while they are still mentally fit to do so. So my parents are my tenants. I pay from the rent the remaining loans and the maintenance.

My brother has concurrently been transferred an apartment, which is worth significantly less than the house. At a certain point X (which I can bring forward if I want), I will pay my brother out.

I think the question is also whether, for example, you can already estimate the extent of your renovation needs?

Maybe never ;) I have such a constellation.

My parents transferred their house to me because they want to have the most important things arranged as long as they are mentally capable of doing so. So my parents are my tenants. I use the rent to pay off the remaining loans and maintenance.

My brother was simultaneously transferred an apartment, which is worth significantly less than the house. At some point X (which I can bring forward if I want), I will pay my brother out.

I think the question is also whether you can already estimate the extent of your renovation needs, for example?

That’s how it sounded to me too, hence my question. Of course, I don’t know the family situation, just want to suggest being cautious. You’re taking on a large loan to pay off your siblings and also renovate. Will you still be able to get a second loan if you want to buy/build a house yourself? A right of residence makes the house more or less unsellable. Repairs will come up eventually. The parents may become in need of care, what then happens with the house? If the rent covers the loan, then everything is fine, but there are a few points to consider. Personally, I wouldn’t necessarily want to tie myself to the house.

Afterwards, that’s how it sounded to me too, hence my question.
Of course, I don’t know the family situation; I just want to suggest being cautious. You are taking out a large loan to pay out your siblings and also to renovate. Will it still work to get a second loan if you want to buy/build a house yourself? The right of residence makes the house more or less unsellable. At some point, more repairs will come. The parents might become in need of care, so how will things continue with the house then? If the rent covers the loan, that’s all fine, but a few points should be considered. Personally, I wouldn’t necessarily want to tie that house to my neck.

Definitely. Such a gift must be reasonable and well thought out, and you should also go through the worst-case scenarios. Sometimes it’s not that easy to find a solution that makes everyone feel comfortable.

Take the investments. The simple calculation is: You determine the value of the house before you invest even one euro. You pay out your siblings. Then you invest amount X into the house. All good because the house is now worth more… in reality, the house probably won’t be worth X more. Because not everything you do increases the value. Some is merely value-preserving.

And it’s not just about what is legal or usual. It’s also about what you feel comfortable with.