Advice on big cash loan for house purchase

Right, bit of back story first:

I currently have two terraced houses, adjoining each other(one in my mums name,one in mine)we own them outright (Mortgage paid & freehold).

My mum is elderly and cant manage the stairs anymore. It would make sense to sell both properties and buy one larger house with a converted downstairs annexe for my mum to live in. These are quite rare and sell quickly. I need to sell both my houses simultaneously to afford the purchase.

My life long friend has a significant amount of savings (he was left a lot of money from parents will), and is offering to lend me £150K to be added to my £60k savings to enable me to purchase outright a suitable property, without me having to get a bridging loan.

Once empty my two houses should sell quickly - in a popular student area close to city centre. and should, at current market prices/and at latest valuation - achieve £70k more than the loan he is giving.

Any legal problems in any of this?

I could do with emptying both houses and doing a bit of re-wiring and redecorating/ a couple of new kitchens etc. Would make them more presentable and hopefully add a bit to their value. I've got plenty of time on my hands (early retirement) and my cousin's an electrician, so thought that might be an option. However if an investor bought them for students, they would probably rip everything out to create extra bedroom options???

Thanks in advance.

My advice would be to get a legally binding agreement with regard to the loan. Whatever the basis of trust and friendship there is between you and your friend, 150k is a lot of money and you should seek to cover all eventualities. Your friend might be too embarrassed to raise this with you, because of your friendship, but I think you should raise it as the main beneficiary of the transaction.

Yeah, it's not £50 for a night out because you've forgotten your bank card. Get a contract drawn up.

Perhaps the loan can even be secured against the sale of one of the houses or something?

It's worth spending a few hundred on a solicitor to ensure that both parties are comfortable and legally protected in the arrangement.

My advice would be to get a legally binding agreement with regard to the loan. Whatever the basis of trust and friendship there is between you and your friend, 150k is a lot of money and you should seek to cover all eventualities. Your friend might be too embarrassed to raise this with you, because of your friendship, but I think you should raise it as the main beneficiary of the transaction.

Yeah, it's not £50 for a night out because you've forgotten your bank card. Get a contract drawn up.

Perhaps the loan can even be secured against the sale of one of the houses or something?

It's worth spending a few hundred on a solicitor to ensure that both parties are comfortable and legally protected in the arrangement.

Yes. The loan would be secured by a mortgage deed. The lender (mortgagee) would be protected by registering a charge against each house. To avoid losing a good friend, you and he should have different solicitors advising.

I could do with emptying both houses and doing a bit of re-wiring and redecorating/ a couple of new kitchens etc. Would make them more presentable and hopefully add a bit to their value. I've got plenty of time on my hands (early retirement) and my cousin's an electrician, so thought that might be an option. However if an investor bought them for students, they would probably rip everything out to create extra bedroom options???

 

Thanks in advance.

I'd agree with the other comments re the main question so nothing to add there.

As to what to do to get the best price for your property I'd suggest getting a decent estate agent in first who will give advice rather than just wanting to put the properties on the market as quick as they can. Sometimes you can spend quite a bit and it doesn't raise the value or speed up the sale. Other work may do the opposite. Much depends on the area and the buyer profile (investor etc). Auction can be a good option for some properties but not for others