I need some help!

Mrs_pbradley936

My son has a one bed flat which he lives in - we have a 2 bed flat which we rent out. My son wants to move into the 2 bed so he can take a lodger to help with bills. His suggestion is that he gets a tenant in his flat and pays the rent money to us. There is a difference of about £80 per month but that does not concern us. We just want to know if there are any pitfalls to be aware of.

pmlindyloo

Does your son own his own flat?

Mrs_pbradley936

pmlindyloo wrote: »

Does your son own his own flat?

Yes he does.

[Deleted User]

If he can't manage a one bed flat.., how could he manage a two bed flat, and lodger? What happens if there are problems with the lodger.., or void periods?

AlexMac

Apart from needing to declare and pay tax on any profit (which is easy- and which I assume you already do on your place) the main pitfall might be if he is less businesslike than you are about running what is, in effect a business; with all the usual leagal reponsibilities that go with being a landlord.

I started as an amateur with one 'accidental' buy to let (I now only have two) and learned on the job, but was always meticulous, with help at first from agents on matters of
-selecting and reference-checking tenants,
-issuing legally watertight ASTs, deposit proitection,
- gas safety check, etc, (now including smoke and CO2 detectors...
- then chasing (very rare) debt,
-fixing leaks, replacing broken boilers, fridges, washing machines, etc..

If Dear Child is up to that- fine... the danger will be if he sits back, assumes you'll do it then carries on for the next 20 years like that 'cos its easy?

This might seems a good short-term solution, but thinking longer term and worst scenario, one problem tenant - bad debts, trashed flat, court costs, months to evict... might cost more than the one off costs of simply buying a bigger flat?

But looking on the bright side- I've never had tenant problems (other than several grands' worth of boilers , washers, leaks, freeholder costs for new windows etc ) in 18 years- by treating people right

pmlindyloo

I am presuming that he has a mortgage on the flat if he isn't managing with the bills.

So he will need permission from his mortgage lender to have a tenant. Then he will have all the responsibilities of being a landlord. Has he checked these out?

Then he will pay the rent from his tenant (in his house) to you? What about his mortgage?

Sorry, a bit confused! Can you explain exactly how he sees this working, perhaps with some made up figures?

alibean121

Honestly if you don't mind losing £80pm from your rental income, it's probably easier to just keep the current arrangement and give some cash to your son! This seems like a recipe for disaster...

Mrs_pbradley936

Thanks for your suggestions. It is more about the lodger needing somewhere to live. He has split up from his girlfriend and although my son is happy to have him on the sofa for a week or so he does not want it to be permanent, hence his suggestion.

ognum

Have you considered the tax implications of this and the LL responsibilities.

Your son becomes a LL, he has all th LL responsibilities, gas checks etc, he has to pay tax on the incoming rent, he has to notify his lender (if he has one) this may alter his interest rate on his mortgage.

The cost will be a lot more than £80.

ognum

Mrs_pbradley936 wrote: »

Thanks for your suggestions. It is more about the lodger needing somewhere to live. He has split up from his girlfriend and although my son is happy to have him on the sofa for a week or so he does not want it to be permanent, hence his suggestion.

Is the lodger really your responsibility?

mrginge

Does your son's lease permit him to rent his flat?