can you rent your house out under BR

civic_3

Hi folks, me and the wife will be going the BR route, and we currently have our house up for sale. We live in a 2 bed house with 2 boys and one on the way so we desperately need another beroom.
House has been up for sale for nearly 2 years and not going anywhere due to the housing market.

Is it poss to rent out our current house under a BR and move to a bigger house and the rent from our current house would pay the rent on the new one.

Would the rent be seen as an income and would the OR want the rental money even though it would be used for rent on the new house?

As the house is already for sale would the OR see this as an opportunity to force us out and get rid of the house cheap to recoup some money, or would it be in our best interest to take the house off the market before we go BR?

If we do sell under a BR, would the OR want whatever profit is made on it to pay creditors?

Our only hope to move to a 3 bed house is to rent this one out, and pay rent on a bigger house, as there is no way we could get mortgage.

Thanks.

peachyprice

The OR has recently tightened up the rules on renting out houses that you own, firstly they will tell your mortgage provider that you aren't living there and your MP will want to change it to a BTL mortgage, secondly the OR will collect the rent and not allow you to pay the mortgage. You can come to an agreement whereby the MP will become the LL and collect the rent, so the mortgage still gets paid.

There are a couple of posters here who have just become subject to these rules and are waiting to see what happens next.

If there is equity in the house the OR will want someone to pay that to the OR or will want the house sold, but they usually give 12 months grace.

pingu2209

If you have been on the market for 2 years, my suggestion is that you are expecting too much for your house and need to dramatically drop the price. In that case you may be in negative equity.

debtinfo

If there is equity in the property and you are both going bankrupt then the Trustee will want the whole equity out of the property, which if the eqquity is significant will probably mean selling the property at some point. Whilst in the hands of the Trustee you will not have control over it and so will not be able rent the property out.