RTLU want to appoint an IP re rental property, help please

JPS29

Hi.

After 3 and a half years I've just spoken with the rtlu over my rental property and they have advised that they would like an IP to deal with it.

The property is in negative equity so I cant understand why they are appointing an IP. To me this will just add another party to deal with and then of course their fees.

If there was equity then i could understand but as there's not then why are they being appointed. Also if the IP pushes for a sale then the shortfall will be due from my wife as its a joint mortgage, which will force her into BR.

Please can someone offer any help/advice?

silvercar

If there is a sale, your wife could buy the beneficial interest for little more than the legal costs.

JPS29

Sorry silvercar I dont understand. I thought that with this being a buy to let and not our residential that they would look to sell elsewhere? Or am I mistaken, and also wont there be high IP fees too?

silvercar

JPS29 wrote: »

Sorry silvercar I dont understand. I thought that with this being a buy to let and not our residential that they would look to sell elsewhere? Or am I mistaken, and also wont there be high IP fees too?

Its in negative equity, so they wouldn't get any money by selling elsewhere.

[Deleted User]

FWIW and DON"T quote me because I'm not sure about this but recall reading something along the lines of the OR may take the income from the rental property and do what they will with it, something to do with it being part of your estate....
I'm sure someone will be along with more definite answer soon

lbm

debtinfo

do also remember as i have said many times that they are just the OR's guidelines if an IP is appointed they may deal with it in an entirely different manner. They may take the renta income, they may pay the mortgage they may not, they may offer you the beneficial interest they may not

JPS29

See this is where I explained there will be complications with the RTLU but they didnt care. The rent is paid cash each week as per the Tenancy agreement. The rent is normally picked up between 8 and 9pm on either a saturday or sunday night. The Tenant wont pay into a bank account or set up a dd but as hes a good tenant I put up with this. Surely the IP wont go rouns at these times like I do.

Debtinfo when you say they may offer you the BI they may not, how does that work then in the latter case. surely they cant just leave it in limbo til they feel like. My fear is they COULD force a sale through auction. Yes the house achieves nothing but its another case closed and surely they must get their fee paid by someone, or am I wrong?

debtinfo

JPS29 wrote: »

See this is where I explained there will be complications with the RTLU but they didnt care. The rent is paid cash each week as per the Tenancy agreement. The rent is normally picked up between 8 and 9pm on either a saturday or sunday night. The Tenant wont pay into a bank account or set up a dd but as hes a good tenant I put up with this. Surely the IP wont go rouns at these times like I do.

Debtinfo when you say they may offer you the BI they may not, how does that work then in the latter case. surely they cant just leave it in limbo til they feel like. My fear is they COULD force a sale through auction. Yes the house achieves nothing but its another case closed and surely they must get their fee paid by someone, or am I wrong?

Well the tenant may decide they would like to pay into an account if the alternative is that they dont live there. The IP wont be going round to collect the rent, but could if they wanted to put someone else in the property.

What is the rent compared to the mortgage, is their a surplus, if their is then the IP may choose to keep it forever, there is no time limit to deal with an investment property, The IP will only be taking t over f they can make some money from it either through rent or by holding it until prices rise

JPS29

He would move out for sure as there are a glut of private rentals in the area, and the street, who would be happy to have a tenant pay them cash every week, and he knows it. At the moment there is a surplus but there wont be when rates rise again, I remeber actually having to top it up at circa 5% interest rates.

Surely they cant just have carte blanche over the whole affair. There must be rules they have to adhere to if the interested party wants to buy back the BI. If they wanted to sell the house I would gladly let them but my wife will be liable for the shortfall so why would it be in their interest to push her into BR. Has anyone ever challenged this through court that you know of?

Also if the IP wants to collect the rent, does that then make them the landlord, to be rang at all hours with problmes etc and maintenance issues, gas elec checks etc and take full ownership of the property?

debtinfo

ahhhh, sorry didnt realise it was jointly owned, that changes everything, it means that the IP has alot less power as they only have an interest in your share not in the legal title, you would remain the lanlord in that case and the IP can only demand that you hand over your half of the income, thats about as much as they can do for now, the OP could ask the court for an order of sale but is unlikely to if in negative equity, so they have 3 options,

1 the order of sale

2 collect you half of the rent, shortterm gain as this means that the Mortgage will eventually reposses as they will only be getting paid half.

3 collect nothing and let you pay the mortgage in full and keep the property on its books until there is equity at which point your wife gets half and the IP gets half.

you have to understand the principle that as it is an investment property the IP has an UNLIMITED amount of time t deal with it if they want to

JPS29

Thanks
I fully understand and agree that in the future it may become an assett and make a profit again and am not after a free meal from them, I just wanted to be treated fairly.

The property is only a 2 up 2 down (think coronation street and you're not far wrong!) terrace that was purchased right at the peak of the property prices for £75 k,
£64 ish owing on mortgage now and property in that road selling recently for 45-50k.

I was hoping they would want it off their books and come up with a figure or accept an offer that I would make, of anything up to 5k just to get rid of the burden and stress.
Or are they not open to offers?