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Property development
ceejayblue
Posts: 310 Forumite
My friends are thinking of buying a property that needs modernisation. It is in a good area and could be made into a very desirable home. They have a deposit of around £35000 but are talking about putting the mortgate in their daughter's name. She has not got a full time job and is currently temping and I am not sure how they could get a mortgage in her name.
Initially they want to buy the property as a buy to let but then sell it after a few months. I don't want to give them wrong advice but I get the awful feeling that they haven't really looked into this very well and are heading for a very big problem if they go ahead.
What sort of mortgager would give a 24 year old a mortgage of any kind, let along a buy to let, when they haven't got a proper job and, if they do get a mortgage and then sell after they've done it up where do they stand on Captial Gains tax and income tax if it needs to be paid? I'm very concerned that this could all back fire on them and they would be in a worse position than they expect to be.
Initially they want to buy the property as a buy to let but then sell it after a few months. I don't want to give them wrong advice but I get the awful feeling that they haven't really looked into this very well and are heading for a very big problem if they go ahead.
What sort of mortgager would give a 24 year old a mortgage of any kind, let along a buy to let, when they haven't got a proper job and, if they do get a mortgage and then sell after they've done it up where do they stand on Captial Gains tax and income tax if it needs to be paid? I'm very concerned that this could all back fire on them and they would be in a worse position than they expect to be.
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Comments
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I have the same reservations about this as you have...0
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so do i. they have not looked in to this at all, other than the money they could make. the daughter has no chance of getting a loan on her own. she could go on the application, and on the deeds, so the GCT would be spit between them all. as getting a BTL loan, with no intention of letting, read the small print on the application. the outcome could be interesting!0
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I am guessing that banks would currently lend to a 12 year old with a paper round on a buy to let. With £35k she will be able to borrow £110k non status, as she is a low risk, job status no problem. After that she will get a higher mortgage if she can show stability in employment and decent credit scoring elsewhere.
I would stay out, as it is their car crash, you never know it could work............0
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