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Transferring BTL into Joint Names
dbrown
Posts: 4 Newbie
My wife owns a BTL property outright with no mortgage, and the rental income is also in her name for tax purposes as she is a basic rate tax payer. She is now considering taking out a BTL mortgage on the property, but it is proving difficult to find a suitable mortgage as she fails the income affordability criteria. A mortgage broker has said that we can transfer the ownership into joint names and then apply for a joint mortgage, but still have all the income in her name for tax purposes. Is this correct, and if so what costs would be involved in the transfer?
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Comments
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Her own income shouldn't matter. A broker should be able to find a mortgage based solely on the rental income.
Does she own the property you live in now? Even if it's jointly with you.
What's the purpose of remortgaging?:footie:
Regular savers earn 6% interest (HSBC, First Direct, M&S) Loans cost 2.9% per year (Nationwide) = FREE money. 0 -
No, the broker is wrong, not surprising has his not a tax inspector.
The Tax man will see it has income (from the rent) from both of you.
You could split the ownership of the house 99/1% in her favour.0 -
We are looking to remortgage so we can use the money to help purchase the neighbouring semi detached property as another BTL. The problem here is that we are told we will not be able to get a BTL mortgage on this property as it is semi-detached and could be knocked into a single residence.
Yes my wife is also joint owner of our own residence0 -
Sorry just to be clear the semi-detached property is attached to our main residence not the current BTL0
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Do you really want to live right next door to your tenants?
I'd look for an investment property elsewhere that you can get a mortgage on.:footie: Regular savers earn 6% interest (HSBC, First Direct, M&S) Loans cost 2.9% per year (Nationwide) = FREE money. 0 -
Yes we appreciate the potential issues here in terms of needy tenants, but we are balancing that against having some control over who lives next door to us and what they do to the property.
So what's the recommendation regarding the existing BTL in terms of change to joint ownership & income for tax purposes?0 -
Yes we appreciate the potential issues here in terms of needy tenants, but we are balancing that against having some control over who lives next door to us and what they do to the property.
So what's the recommendation regarding the existing BTL in terms of change to joint ownership & income for tax purposes?
You will have no more control over them than if they lived a distance away. You cannot ever knock on the door any time you have a complaint against them everything must be in writing and what if they stop paying rent. If you ever spoke to them when they are entering or exiting their property mentioning the outstanding rent you could have an order making you stay away from your own property. You would find yourself homeless.
Actually I'd find it extremely frustrating as a landlord and creepy as a tenant. I'd fear being watched all the time.
And the reason you can't get a mortgage on it...what if the property were to burn down. There is a high chance it could take your property out with it too. If your house burns down and your tenants live a distance away you can evict them and move in whilst your property is being rebuilt. There's just too many issues.
Find something else which you can buy in your own name with a mortgage. And ask on the mortgages forum for your mortgage specific question.:footie: Regular savers earn 6% interest (HSBC, First Direct, M&S) Loans cost 2.9% per year (Nationwide) = FREE money. 0 -
you are married, tax law therefore dictates that married couples must split the rental income in accordance with their respective ownership shares. You could specify a ridiculously small decimal point share, but 99% v 1% would be more "usual".So what's the recommendation regarding the existing BTL in terms of change to joint ownership & income for tax purposes?
You will need to register a Form 17 with HMRC (google it!) to reflect the respective tenants in common shares
of course your respective shares have no impact on a mortgage as that will be joint and several liability.0
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