Taking in a lodger - legal stuff

ibz75

Hi all, hope you all had a good xmas and have fully recovered!!!

I recently purchased my first home in a different town (living with parents at the moment). Its a 3 bed (2 1/2 if you're fussy!) house, so I have 2 spare rooms. I was thinking of renting out one of the larger rooms but want to do this legally ( I work for the local council so mortgage/rental fraud may be frowned upon!).

Its a residential mortgage, so would I have to get permission from my lender? Has anybody been refused this?

Will I need all the Gas Safety certs etc?

Will I need a landlord insurance policy?

I'm new to this so any advice/opinions welcomed.

McKneff

Dont know that there is much legality regarding having a lodger.
Certainly dont need GS certs.
Tell them (written of course too) to get their own possession insurance.
Dont think permission would be needed from your lender.
You would have to let your household building/contents insurer know.

For your lodger - written house rules and notice period.

missile

Tax free income, there is a limit.
Be careful who you let stay in your home.
Many insurance policies will not cover theft by a lodger.
Do not let lodger invite guests.

ibz75

Thanks Mckneff and Missile. I want to do things 'by the book' and have looked at the 'rent-a-room' scheme. But I'm just a bit confused with the difference between having a lodger and 'letting' the property - especially all the legal or 'normal' requirements. If anybody has any experience in this field, I would love to hear your guidence/thoughts on this.

Yorkie1

As I understand it, the very basic difference between having a lodger and letting the property is that if you continue to live in the property, the other person is a lodger. This means that they are not protected by the legal rules which apply to a tenancy / letting. e.g. no need to protect any deposit, no minimum 6-month tenancy period before you can ask them to leave etc.

If you are not resident, you're granting a tenancy - usually an assured shorthold tenancy. This creates the statutory duties such as protection of any deposit if the annual rent is less than £25K, gas safety cert, and the various laws about how and when you can evict them.

gld73

Getting a lodger in doesn't involve all the legal hassles of renting a house/flat to a tenant. I had lodgers a couple of times - the only things I did was notify my insurer to see if it made a difference, and contact the council to pay full council tax (rather than getting the 25% single occupant discount). Your mortgage lender doesn't need to be informed, and you don't need the gas and electrical safety certificates.

Asides from how much to charge (which will depend on the location and standard of accommodation), some of the things you need to consider are what will covered by the rent they pay (all bills excluding phonecalls is usual), how to find a lodger (personal contacts or advertising), whether you'll allow guests, whether you want a fulltime lodger or just a Mon-Fri one, whether you'll accept smoking, what deposit you ask for .... I've been lucky, the couple of lodgers I had (one found via 'spareroom', the other via 'easyroommate') were both really good and never gave me any hassle. Hope you're lucky with yours too!

BitterAndTwisted

You'll probably find that the most taxing and vexatious things about having a lodger will most likely revolve around paying an equal share for consumables (milk, tea-bags, laundry detergent etcetera) and who's doing a fair share of the housework and the lodger having the central-heating on the "tropical setting" whenever you're out.

I've been a lodger and have also had lodgers staying with me and have never included the heating and hot-water bills. I paid the land-line rental and the calls (not itemised at the time) were split 50/50.

You need to be absolutely crystal-clear about your attitude to overnight guests and mates coming round from the very beginning to avoid misunderstandings and/or resentment later on.

clutton_2

research the Rent A Room scheme on the Inland revenue site... you dont have to pay tax on income less than a certain amount..