Any ideas people?

slowlife78

Here's the situation:

8 Years ago, my parents got a flat in Edinburgh and put it under my name. They live there and
pay for an interest only mortgage (£110 a month).

Now I got married and want to buy a property for my new family but because I already have the mortgage of my parents,
I cannot (not with our current income). So we will have to rent albeit a bigger place. However, we cannot afford it.
Therefore,


Since I don't want my parents to move to a different place, I was wondering if I could have them apply for
housing benefits and use that money to either pay towards capital
or to help us cover the difference in rent paymt of a bigger place here in England.

Note, if they continue to pay interest only, a) Even when my wife goes back to a full time job we will not qualify for
a mortgage
because we are accountable for the portion of capital that my parents are not paying) and
b)all this effort that I now have to do of renting
instead of buying will not benefit me when the term is over (in 18 yrs) because the bank will end up reposesing the flat.

If we were to use the money they get from housing benefits to cover the rest of our own rent, we need to know:

1. Could I change my current mortgage to a buy to let and rent it to my own parents? Do I even need to do that?
2. Would they be denied housing benefits if they are to pay to their own son?



If they didn't have that flat under my name and were paying such low monthly payment (£110), they would have had to apply
for housing benefits anyway and would be paying it to someone else.

I thought I was doing them a favour back then but now that I have a wife and a baby and cannot provide for them I'm really seeing I should have asked
more questions before signing.

Thanks David

Pixie5740

Do you currently have consent to let?

Are you registered with Edinburgh City Council as a landlord and fulfilling all your other duties as a landlord? Do you have a written tenancy agreement? If yes is is an Assured Tenancy or a Short Assured Tenancy?

I believe that if you get a BTL mortgage to let to family it needs to be a regulated BTL mortgage and the council will could consider this a contrived tenancy if your parents try to claim HB leaving you up the proverbial creek without a paddle.

Is there a repayment vehicle in place to repay the capital with the mortgage term ends?

Thrugelmir

slowlife78 wrote: »

8 Years ago, my parents got a flat in Edinburgh and put it under my name. They live there and
pay for an interest only mortgage (£110 a month).

Time for a heart to heart to heart chat with your parents. With such a low outgoing why haven't they been repaying the capital element of the mortgage. If the property is in your name then it's yours to do with as you wish.

Why did you agree to have the mortgage and property in your name?

dimbo61

Prices has gone up hugely in Edinburgh over the last 8 years.
As the landlord you can serve an S21 and evict your tenants.
Sell up and you have a large deposit for your family home in England

Pixie5740

dimbo61 wrote: »

Prices has gone up hugely in Edinburgh over the last 8 years.
As the landlord you can serve an S21 and evict your tenants.
Sell up and you have a large deposit for your family home in England

Good luck serving a Section 21 in Scotland.