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  • FIRST POST
    • Lillywhite27
    • By Lillywhite27 11th Jul 17, 9:38 AM
    • 1Posts
    • 0Thanks
    Lillywhite27
    Rent to a friend
    • #1
    • 11th Jul 17, 9:38 AM
    Rent to a friend 11th Jul 17 at 9:38 AM
    Hi,
    I have recently bought a house and due to work i will not be able to move in for a year. I am thinking of allowing my friend to move in and just asking her to pay the mortgage/bills.

    Will i need to tell my mortgage lender? What will change? What will it cost me? Is it worth it or should i just sell up and wait

    Thanks
Page 1
    • Pixie5740
    • By Pixie5740 11th Jul 17, 9:45 AM
    • 10,601 Posts
    • 14,579 Thanks
    Pixie5740
    • #2
    • 11th Jul 17, 9:45 AM
    • #2
    • 11th Jul 17, 9:45 AM
    Yes you will need to request consent to let from your mortgage lender which they might not grant since it appears you've not even moved in yet.

    You will need to comply with all relevant landlord legislation and declare the rental income to HMRC.
    Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
    • gettingtheresometime
    • By gettingtheresometime 11th Jul 17, 10:39 AM
    • 2,471 Posts
    • 5,385 Thanks
    gettingtheresometime
    • #3
    • 11th Jul 17, 10:39 AM
    • #3
    • 11th Jul 17, 10:39 AM
    I'd also formalise it....yes it's a friend but it gets rid of any potential misunderstandings
    Lloyds OD / Natwest OD / PO CC / Wescott cleared thanks to the 1 debt v 100 day challenge


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    • saajan_12
    • By saajan_12 11th Jul 17, 11:03 AM
    • 557 Posts
    • 362 Thanks
    saajan_12
    • #4
    • 11th Jul 17, 11:03 AM
    • #4
    • 11th Jul 17, 11:03 AM
    1) Even if you don't perceive a 'profit', you would have to pay tax on 'rent income - mortgage interest - repairs / bills / etc costs' Note part of your mortgage payment will pay down capital which is not tax deductible.

    2) Landlord obligations still apply, e.g. gas safety check, EPC, protect deposit if you take one, repairs, check friend's right to rent, friend's right to quiet enjoyment

    3) Mortgage: you will need to request Consent to Let from your lender. IF you have just started the mortgage and will be letting the property fairly soon, the lender may think that was your plan all along and refuse CTL, or give CTL for a limited period e.g. 12 months. Then you would need to change to a Buy to Let mortgage (with a maximum 75% loan relative to the property value) and likely higher interest rates.

    4) I would suggest you get a formal tenancy agreement and inventory at the start, so everyone knows their responsibilities and is on the same page. If there is a misunderstanding or people mis remember, the deposit resolution / courts can ultimately decide but you would likely ruin a friendship.
    • G_M
    • By G_M 11th Jul 17, 11:07 AM
    • 40,113 Posts
    • 45,820 Thanks
    G_M
    • #5
    • 11th Jul 17, 11:07 AM
    • #5
    • 11th Jul 17, 11:07 AM
    Hi,
    I have recently bought a house and due to work i will not be able to move in for a year. I am thinking of allowing my friend to move in and just asking her to pay the mortgage/bills.
    You mean you want her to pay you rent.

    Will i need to tell my mortgage lender? Yes
    What will change? You'll be a landlord
    What will it cost me?
    LL insurance; gas report, tax, etc
    Is it worth it or should i just sell up and wait your choice

    Thanks
    Originally posted by Lillywhite27
    Read

    * New landlords: advice, information & links
    • Rambosmum
    • By Rambosmum 11th Jul 17, 11:46 AM
    • 1,321 Posts
    • 1,769 Thanks
    Rambosmum
    • #6
    • 11th Jul 17, 11:46 AM
    • #6
    • 11th Jul 17, 11:46 AM
    Be in absolutely no doubt that doing this will make you a landlord - family, friend, it doesn't matter, you are a landlord in the eyes of the law and have to follow the laws for landlords as described above.
    • Penitent
    • By Penitent 11th Jul 17, 12:19 PM
    • 1,239 Posts
    • 3,646 Thanks
    Penitent
    • #7
    • 11th Jul 17, 12:19 PM
    • #7
    • 11th Jul 17, 12:19 PM
    If you've only just bought it, you're probably going to struggle to sell it.
    • Davesnave
    • By Davesnave 11th Jul 17, 1:25 PM
    • 22,605 Posts
    • 87,471 Thanks
    Davesnave
    • #8
    • 11th Jul 17, 1:25 PM
    • #8
    • 11th Jul 17, 1:25 PM
    If you've only just bought it, you're probably going to struggle to sell it.
    Originally posted by Penitent
    ....... because many lenders are shy of lending on properties that have been only recently purchased.

    (Might be good to say why )
    'A society grows great when old men plant trees whose shade they'll never sit in.'
    • Penitent
    • By Penitent 12th Jul 17, 9:57 AM
    • 1,239 Posts
    • 3,646 Thanks
    Penitent
    • #9
    • 12th Jul 17, 9:57 AM
    • #9
    • 12th Jul 17, 9:57 AM
    ....... because many lenders are shy of lending on properties that have been only recently purchased.

    (Might be good to say why )
    Originally posted by Davesnave
    You're right, 'twas lazy. It'll also make many buyers wary, as they'll assume there's something wrong with it.
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