complicated situation

dizza

First post, so I really hope someone can help.
My situation is that I hold POA`S ( property and affairs) for both my parents. They have a property worth £325000 which they wish to transfer to me.
A mortgage was raised on the property to purchase a warden controlled flat for them. This is a BTL mortgage for £140000.
The original property is let at £1000 PCM.
I have contacted the original lender to see if they would do a transfer of equity in order for me to take over the mortgage to facilitate the transfer, but because I have no employed income they have refused.
The warden controlled flat is up for sale, but it could take a while to sell.
My father has offered to have his pension payments paid into my account for a period of time to enable me to meet the income requirements, but would bank statements showing the income be enough or would lenders need to see some confirmation from the pension company?
Any other suggestions as to how to get around this are most welcome.
thanks in advance.

Sailmakers

Surely the lender would see that the pension income isn't yours? Then you're back to square 1...

EMac_2

Who is the lender? The majority of b2let lenders now require sight of earned income so the pension isn't going to work, There was a buy to let lender who would let you remortgage in your name with no earned income and allow a transfer of equity but i'm not 100% sure they are still doing it. You would need to apply to them via a broker so I'd try and speak to one if I were you. Best of luck

Thrugelmir

dizza wrote: »

The warden controlled flat is up for sale, but it could take a while to sell.

Where are your parents going to live?

Not that I wish to know, but may be relevant to any decision you make.

dizza

Thank you for the replies so far.
The BTL lender is the Leeds, they refused on the basis that a minimum income of £20000 was required before they would consider switching the mortgage to me, they obviously would not take the rental income into consideration, even though at £1000 per month it more than covers the monthly mortgage payment.
My parents are going to live in a rented warden controlled flat, they do not want to own a property at their time of life.

Brock_and_Roll

Just in case you are not aware, there is a potential "Deprivation of Assets" issue here down the line should your parents ever need state-funded residential care. Local authorities are getting, quite rightly, much sharper these days.

dizza

Thank you for pointing that out.
We have taken legal advise and were made aware of the deprivation of assets situation, hopefully the situation will not arise where both need care, if it is only one then care costs can be met by their income, so needing to apply for additional financial help should not be an issue.

getmore4less

Why not just leave the house in their names and run the rental for them.

what sort of POA is it?

If an active LPA then Transfering the house to you yourself is probably not in their best interest.


what do you/parents think the gain is by transfering the property?

Bufger

getmore4less wrote: »

Why not just leave the house in their names and run the rental for them.

what sort of POA is it?

If an active LPA then Transfering the house to you yourself is probably not in their best interest.


what do you/parents think the gain is by transfering the property?

The risk of both of them going in to care longer term is probably high now. Rather than all of their assets funding their care they obviously wish to pass something on. There may well be nothing left when their time comes so some families do the inheritence bit before death (hopefully more than 7 years before!)

My grandparents are going through the same thing. Both are now in care and they saved for years and years to give their sons a big boost in life but now that'll go into their care. Our family do not care about the inhertence and only about their health but it has absolutely broken my grandad.

If you have assets they get swallowed up in the care until its all gone and then you remain in care. The less assets you have the less you need to run out and then recieve the same level of care. It makes money sense to try and pass it on before its too late.

OP, if you cant do this how about them selling up and getting a few gold bars ;-)

Conrad

B2L lenders will have questions about you not putting down a physical 25% deposit or more.

This and other factors make me think this is one for an experienced small broker (not a call centre type broker).