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Selling House for BTL
jimjames
Posts: 19,264 Forumite
A friend recently attended a BTL property seminar that claimed to be able to show how you could purchase a BTL without putting any of your own money in. I'm very sceptical of these types of thing as the seminar only seems to be a money generator for the person running it rather than giving useful advice. I've seen one promoted by Robbie Fowler but there are others about too.
They were looking to sell and buy bigger house anyway to live in themselves but it now appears they are selling up their own home to move into rented house and use the proceeds to buy one or more BTL properties instead.
Whole thing just seems very bad idea and to me having a roof that I own over my head is more important than trying to play the property market when you can't afford to do so and going from owning your house to renting instead.
It does seem that this property/investment company are encouraging them to take this course of action presumably as they'll be making money from the advice and mortgages etc. As I understand it the BTL mortgage market isn't regulated so there is no check that what they are doing is sensible and as such no advice being given that would breach any rules.
Has anyone come across this type of company recommending action like this before? Any suggestions for ways to approach it?
They were looking to sell and buy bigger house anyway to live in themselves but it now appears they are selling up their own home to move into rented house and use the proceeds to buy one or more BTL properties instead.
Whole thing just seems very bad idea and to me having a roof that I own over my head is more important than trying to play the property market when you can't afford to do so and going from owning your house to renting instead.
It does seem that this property/investment company are encouraging them to take this course of action presumably as they'll be making money from the advice and mortgages etc. As I understand it the BTL mortgage market isn't regulated so there is no check that what they are doing is sensible and as such no advice being given that would breach any rules.
Has anyone come across this type of company recommending action like this before? Any suggestions for ways to approach it?
Remember the saying: if it looks too good to be true it almost certainly is.
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Comments
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If you're worried for them, best you can really do is tell them your concerns and that you're worried they might be about to get fleeced, and maybe suggest they go and arrange an appointment with an actual financial advisor to discuss their long-term needs and goals to get some real advice.
As you're evidently aware these types of seminars exist to make money for the person giving away the "secrets", they typically hinge on one or two edge cases to use as examples and make the whole thing sound marvellous but which in practice isn't something anybody can just jump into.
If it was really as easy and safe as the person giving the seminar makes out, they'd be making millions from doing it themselves, not giving crappy seminars in crummy hotel conference rooms.0 -
A fool and his money are soon parted.
I think you are spot on and that this [STRIKE]scam[/STRIKE] scheme has alarm bells all over it.
If this scheme allows people to make money out of BTL investments without investing any money, why do they have to sell their home to fund this venture?0 -
How much did your friend [STRIKE]waste[/STRIKE] spend on this scaminar?.....yes I spelt that correctly !"Dream World" by The B Sharps....describes a lot of the posts in the Loans and Mortgage sections !!!0
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Nothing t add to the responses above.
How you convince your naive friends to think again is another question.......0 -
Foxy-Stoat wrote: »How much did your friend [STRIKE]waste[/STRIKE] spend on this scaminar?.....yes I spelt that correctly !
I believe it was around £1000. Not bad for a "free" seminar!
Frustrating that they didn't ask for advice first especially as they are always hard up - I'd never spend that kind of money on a seminar and I've been investing for 20 years.Nothing t add to the responses above.
How you convince your naive friends to think again is another question.......
That's exactly the problem. Being able to warn them to the dangers of being ripped off without destroying a friendship is going to be a very delicate balancing act. But I can't watch them destroy their capital without saying anything even if they see it as someone trying to stop them making money now they may see it differently in a few years.Remember the saying: if it looks too good to be true it almost certainly is.0
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