My property has BECOME buy to let!!!!

Mustbeananswer??

I'm sure this is not the first time this has happened.


Everything has happened so fast!!I spend most of my time with my new Girlfriend ...that left my large house free.We put our toe in the water and have a couple staying in the home on a lodgings basis.We receive a nice fee for renting two of the 3 rooms out...the couple are DHSS but no trouble.This will probably be under the Government Rent-a-Room scheme.I gave my tenants a six-month contract.

Effectively this means my Mortgage should change...I am told I have to report this.Do I need to relinquish my old Mortgage and have a completely new one.I narrowly missed out on a second mortgage 3 months ago and will this alter things if I wanted to up the value of the Mortgage .If I have to relinquish my old mortgage with Santander will I have to pay the £1200 early release scheme.I have a fantastic rate on my current Mortgage.....


Maybe I should keep stum about the whole affair:eek::eek::eek:

Emmzi

If they are lodgers, and you still have a room there that you live in sometimes, it is not a BTL. As you still have a bedroom there, I'd be sure and stay in ity a few nights a month, and you will be fine. Might want to check your insurance as regards to lodgers though.

Emmzi

PS if they *are* lodgers stop calling them tennants. and a week to week arrangement is more appropriate. You are making them think they have more rights than they do...

00ec25

lets hope your last sentence was in jest, as the info you present shows you have no understanding of what you have done

1. they are either lodgers or tenants, learn the difference it is vital
2. if they are lodgers your "6 month agreement " is not worth the paper it is written on
3. if they are lodgers you can use the RaR scheme, if not, you will be committing tax fraud
4. if they are lodgers you need do nothing with the mortgage
5. if they are tenants you need:
a) LL insurance
b) either permission to let from your mortgage company or switch to a BTL mortgage
c) fulfil all the other legal requirements of being a LL

so what are they: lodgers or tenants?
Hint: the couple are not "lodgers" if you spend "most" of your time with the GF, presumably living elsewhere, since you state the home is "free"

Mustbeananswer??

Thanks Emmzi

Sort of sums it up in a couple of sentences.Didn't want to deluge my new Girlfriend with all my gear so have retained a room and stop in my old house about once a week!!

Mustbeananswer??

Lodgers....definately???

Legislation about how many nights I spend here.....not hear of any??

00ec25

Emmzi wrote: »

If they are lodgers, and you still have a room there that you live in sometimes, it is not a BTL. As you still have a bedroom there, I'd be sure and stay in ity a few nights a month, and you will be fine. Might want to check your insurance as regards to lodgers though.

incorrect
the basis of the RaR scheme is a matter of fact test as to what is the "main" residence, a few nights per week and a room kept for you is NOT your main home

read the HMRC rules here

"Whether a property is an individual's only or main residence at any time in the basis period is entirely a question of fact. "

"Normally we would expect the main residence to be the property that is the taxpayer's home for most of the time. In other words, where friends and correspondents would expect to find the taxpayer."

00ec25

Mustbeananswer?? wrote: »

Lodgers....definately???

Legislation about how many nights I spend here.....not hear of any??

err ,.. no they are not lodgers on that basis and you cannot use the RaR scheme

Mustbeananswer??

Ok....So I may have to pay a bit of Tax.....I'll get over it!!


Any other issues please???

Slinky

Just a thought, if you are living most of the time at your girlfriend's house, is she claiming single person discount on her council tax or have you sorted that out?

hazyjo

"New girlfiend"?

Does she realise you've effectively moved into her home already?!

btw, being a LL involves more than paying 'a bit of tax' lol!

Good luck! I have a feeling you'll be needing it.

Jx