sell up and rent back??

Dithering_Dad

Just looked at your rental...

If rent in my area is £800 per month for a comparable property, I rent over 7 years with you with a 3% RPI. my rent will be:

Yr1 - 800
Yr2 - 824
Yr3 - 848.72
Yr4 - 874.18
Yr5 - 900.41
Yr6 - 927.42
Yr7 - 955.24

Phew! Yet, when I look at rental prices in my area, they seem to stay pretty much static, year after year after year. In fact many landlords would be so pleased to have a good tenant for 7 years, they would count their blessings and leave them well alone!!

Sorry, selling my house at a loss and then continuing to pay off the mortgage via my rent money that increases year on year just isn't for me.

Thanks for the offer though.

teeni

You also need to look very carefully at the rent back tenancy,

I work as a legal adviser in housing issues and see far too many people who have taken this option only to find after the initial 6 month period of the Assured Shorthold tenancy the new landlords issue a section 21 notice to quit, Local authority then find these people intentionally homeless because if they had not sold the house they would not be facing eviction.

If you are seriously considering this take independent legal advice before agreeing to it.

There are some unscrupulous companies that hang around court rooms on possession hearing days signing people up willy nilly without them having a chance to think about it or take legal advice.

Please be careful

Northwest_Guy

Thank you Teeni, This is the point I have been trying to put accross. There are companies out there that just don't care and love making money! I agree with you on seeking advice as it is a legal minefield out there.

Dithering dad.....The retail price index is just that, I would love to know where you have got the RPI for your property over the next 7 years because I could do with next weeks Lottery numbers!

The company I work for are landlords and MUST abide by ALL legislations. We are one if not the only company who is FSA compliant in an industry that at the moment is not regualted which we feel MUST change. Without a regulatory body companies are free to exploit people in a very difficult position, leaving the industry with a tarnished reputation and victims with a bad taste in their mouth.

Regarding the tenant paying off the mortgage for the company, I'm affraid your misinformed again. We do not mortgage properties we have no need to.

Dithering_Dad

I took the current RPI figure and projected forward over the complete 7 years. Actually the current figure is 3.2 but I rounded down. I don't know what the figure will be in reality over the next 7 years, it may be higher or lower than 3% so I took that figure. This is probably no less valid than the arbitrary "5% knocked off asking price" used in your example.

As far as you saying "I only posted to show there are ethical companies in the industry who aren't out to make a killing". This would have more validity if you had provided details of how your company compares against other similar companies, rather than against selling your house the traditional route...

Finally, I'm not misinformed when I said the tenant was paying off the mortgage, because effectively that's what he is doing. You lend money from the bank to buy the properties and the tenant pays this back via his rent (plus a bit on the side so you turn a profit). If you seriously believe your company doesn't borrow money to finance the house pruchases, where on earth do you think they get it from - selling drugs, winning the lottery, from a money tree?

Northwest_Guy

It would be wrong of me to place how we compare to other companies within the industry as this could be seen as slanderous etc.

Not all people are on the comfortable position as yourself having paid most of your mortgage off and being financialy stable.This is aimed at people in the unfortunate position of being faced with either losing their house or finding it hard to keep up the repayments.

It seems to me your are very one sided and not considering other people in this matter. The information I have placed within this thread is here for INFORMATIVE PURPOSES only. Should anyone be searching the site needing information about selling and renting back I am giving them information rather than saying RIP OFF!

I was under the impression that this was an informative site for anybody seeking information. How can this be when people like yourself are beyond biased and sitting pretty. IF this company relied so much on the tanant paying off the "mortgage" on the property why would we have options for people to buy the property back and allow them to leave at any stage of the agreement?

I appreciate that someone in your positon will find it hard to see the whole point to the industry but Information is information and opinion is just that.

JonnyBravo

Money tree?

oh heck.... I forgot to water mine whilst on holiday......

oh well, I'll get another from B&Q this weekend

Dithering_Dad

Northwest_Guy wrote: »

It would be wrong of me to place how we compare to other companies within the industry as this could be seen as slanderous etc.

Not all people are on the comfortable position as yourself having paid your mortgage off and this is aimed at people in the unfortunate position of being faced with either losing their house or finding it hard to keep up the repayments.

It seems to me your are very one sided and not considering other people in this matter. The information I have placed within this thread is here for INFORMATIVE PURPOSES only. Should anyone be searching the site needing information about selling and renting back I am giving them information rather than saying RIP OFF!

I was under the impression that this was an informative site for anybody seeking information. How can this be when people like yourself are beyond biased and sitting pretty. IF this company relied so much on the tanant paying off the "mortgage" on the property why would we have options for people to buy the property back and allow them to leave at any stage of the agreement?

I appreciate that someone in your positon will find it hard to see the whole point to the industry but Information is information and opinion is just that.

Oh dear, I take it from the "fat fingered" typos and general nature of your rant that I have hit on a raw nerve. Perhaps you are right and from my hallowed position of "having paid off my mortgage" (I wish) I should help my fellow man, just like your charitable company. Ok, I'm up to the challenge, so here is what I propose:

I have a great credit rating and some savings put by, so I'll use this to my advantage, oops I mean to my fellow man's advantage. I find someone who is desperate because they have money problems and I get them to sell me their property for 20% less than it is worth.

Due to having a larger deposit than my victims, oops I mean prospective clients, and much better credit rating I manage to get a much better mortgage rate than they could hope for.

I get an interest only mortgage fixed for 7 years. The mortgage on their property is now quite reasonable and can be covered by their rent. I have tenants for 7 years, which should see me through any dips in the market.

Each year, I increase their rent in line with RPI, yet my interest-only fixed-rate mortgage stays the same, so I bank the difference. After 7 years I have a decision to make, I can either:

Use the profits gained from increasing their rent year on year to pay down the mortgage and get another 7 year fixed rate and do the whole scam again until eventually the tenants leave or eventually completely pay off my mortgage for me.

Or I could find that house prices have increased in value again so I turf them out and sell the house (at full market price). Even if after 7 years house prices have remained static, I have a 20% gain already factored in from the original purchase plus the profits from the increasing rent money.

Hmnn, I seem to gain nicely from this which ever way I turn. Not really sure how this is helping anyone but me.

A good business idea though - much better than my current one of fixing problems with company's HR and payroll systems. Hmnn, surely there is a reason I haven't branched out into this new and exciting field?

Oh yes, integrity. Tsk, just when you're about to benefit from the troubles of your fellow man, integrity jumps in and ruins it. Damn it!


************************** WARNING**************

Please note that this post contains high levels of sarcasm.

***********************************************

p.s. to answer your points on the purpose of this forum... it is intended for debate and to provide different points of view so that people can make an informed decision about their finances. I have a different opinion from yours but I don't stand to gain financially by expressing it, unlike you and your internet links....

Northwest_Guy

Thanks for making my point. Once again it would seem you have gone down to name calling. I never said anything about being charitable nor have I continued to mention or try to sell the product.

I wil try to explain this again. The information is there for anyone wanting to read it. You never know it could help someone. OPINION IS OPINION and I appreciate that everyone is entitled to one. It would seem once again that going over the point of Not the best way but not the worst would be a waist of my time.

It's great that you have a lovely credit rating and wonderful that you are under the impression that you would be able to succeed in this field & I emplore you to do so if you so wish. AS I MENTIONED BEFORE.........(and please don't make me have to go through this another time)

IF SOMEONE HAS ARREARS ON THEIR MORTGAGE ACCOUNT AND HAVE EITHER NEGATIVE OR LITTLE EQUITY IN THE PROPERTY AND THEY DO NOT WANT TO LOOSE THEIR HOME. THE CHANCES FOR THESE PEOPLE TO GET A REMORTGAGE, LIFETIME MORTGAGE OR ANYTHING IN THE FIELD OF FURTHER LENDING IS NEAR TO IMPOSSIBLE (unless as you say the magic money tree is available) THE SELL AND RENT BACK SCHEME IS HELPFUL FOR THESE PEOPLE WEATHER YOU SAY SCAM OR NOT IS YOUR OPINION. IF SOMEONE IS IN THE ABOVE UNFORTUNATE POSITION (Not as mentioned before in your position of financially stable) THEIR OPINION MAY WELL BE DIFFERENT.

I have asked you to consider this from others position yet you remain on your financially stable high horse and look down at the people who really do need help. NO we aren't saints and NO we aren't a charity but YES we look after our tenants and YES we give a fair price, considering we don't charge anybody any fee's and pay ALL costs incurred.

At the end of the day people will do what they want to do. It isn't the best solution but as I said before it is not the worst by a long long way. I wouldn't expect for you to understand this as you are fortunate and I hope that you will continue to do so.

Sarcasm the lowest from of wit...........me thinks this tells me something else

P.S. In response to your PS. I have very much enjoyed our debate and think we have bith put our points accross, however you must of gained financially from using this site otherwise I don't think you would be using it. Even a saving of £20 from infromation on the site is a financial gain. The link was for INFORMATIVE purposes. I as a person WILL NOT have any financial gain from this link and I have posted on here off my own back. I really doubt the company will gain either as we have a marketing strategy we use and don't rely on the website for business. Don't believe me try finding us on a search engine.....If we are on there I guarantee it's a very very low listing.

Many thanks for the debate I hope this will not effect any future communications we may have.

Guy

margaretclare

To return to the original post - no, don't even consider it. What you have to leave to the kids is irrelevant, but if you have difficulty paying your mortgage now, why even consider losing your one major asset and committing to paying rent for the rest of your life? You'll have no control at all as to the level of rent you pay. At least you know that your mortgage won't last for ever.

You say you'd be debt-free, but you'd be committed to paying for something that you owned which someone else now owns.

Bargepole - don't touch with - springs to mind.

We're always getting flyers through the door with this kind of offer. The flyers go straight into the bin. Even though we're an older couple (as someone mentioned) we have no money worries so why would we even give it a passing thought.

Margaret

Dithering_Dad

Northwest_Guy wrote: »

Thanks for making my point. Once again it would seem you have gone down to name calling.

Name calling?? Once again?? :huh: As I recall I questioned your figures and motives and you said "people like yourself are beyond biased and sitting pretty". Seems to me like you are the one making personal attacks while I am merely attacking your employer and your industry.

Northwest_Guy wrote: »

The information is there for anyone wanting to read it. You never know it could help someone. OPINION IS OPINION and I appreciate that everyone is entitled to one.

Your original post didn't express an opinion, it merely promoted your company. Had you simply given an opinion of why you think that in certain circumstances, this particular product/service would be of use and provided unbaised examples of how the figures stand up. I would have read it with interest and then moved on. What you did was rubbish your competitors "It is a shame that there are so many companies in this industry that are out to make a killing", then promote your company with a web link and statements such as "The company DO NOT pay less than 80% of the market value of the property, (the valuation is carried out by independants(No charge)) there are no charges for our service and it is completely no obligation. " and then provided a completely biased example of poor Mr Smith where we got to see how much it would cost for him to sell his house in the traditional method, but no comparable figures on how selling his house to your company would stack up.

Northwest_Guy wrote: »

I have asked you to consider this from others position yet you remain on your financially stable high horse and look down at the people who really do need help.

The only thing I am looking down on is your industry. I have not expressed a single opinion or any form of judgement, negative or otherwise on people who get into financial difficulties. I am merely expressing a different opinion from yours and for some strange reason this really gets to you.

Northwest_Guy wrote: »

At the end of the day people will do what they want to do. It isn't the best solution but as I said before it is not the worst by a long long way. I wouldn't expect for you to understand this as you are fortunate and I hope that you will continue to do so.

I do understand the part in bold, and I have to say it's the most truthfull thing you've said all day. It really isn't the best solution and I'm glad that you have admitted that much.