Getting a mortgage FOR my parents? Advice please

paddedjohn

There would be more profit to be made by buying a property for circa £50/£70k cash doing a quick refurb and knocking it on quickly than getting mortgages involved.

david29dpo

As said above, start small.
I have "flipped" 7 properties in 8 years, all sub £125k all before the crash.
All bought for cash, first one was cheap. Not a good idea involving mortgages.
Worked for me!

kingstreet

PCManchester2012 wrote: »

This wouldn't be a BTL mortgage - it would be a straight mortgage. The mortgage would be in my name, the property in joint names between my parents and myself, and that's it. The property wouldn't be let to anyone, it would be sold once complete. I wouldn't even tell the broker our plans - it's none of their business. I'd simply be after a mortgage that can be paid back quickly... I've seen some that only have early repayment charges if paid back within 1 year for example (my current house was one of these).

The £220k - £255k numbers were just an idea after a quick conversation we've had. Not necessarily true figures as the final sale price would likely be higher, though it depends on the amount of work that is done. Also, my dad owns a string of landscaping centres and so building materials can be sourced at cost price.

You can't have more owners than there are borrowers. If you are the sole borrower, you'll be the sole owner.

You then have problems with the deposit coming from a third party.

You won't be living in the property, so it's not residential. However, BTL lenders don't want renovation projects. Family members will be living in it, so it's a regulated loan.

Finally, if a profit is made and the property and mortgage are in your name, but isn't your primary residence, there will be a CGT liability.

As I said earlier, this is going to be difficult. Then you stick on top of it all that you want a short-penalty product, so there's no charge for the quick flip.

Good luck.

Brallaqueen

Property refurbs are not as easy as they look. My brother tried it, a decade in the property game and confident he knew what he was doing. He was wrong, went overbudget and over time, the house did not sell, so he's had to rent it out and he's not made any profit. It can go wrong so easily!