OH moving in to mortgaged flat

smichr

Hello folks,

It's looking likely my OH is going to be moving in to my flat at some point in the next few months! :j

But I want to make sure everything is OK paperwork wise and don't get caught out.

Obviously, will have to sort council tax (and remove the single occupant discount), but is there anything else I need to be aware of?

From initial conversations we'll be splitting bills 50.50 probably through a joint account, but for now it'll still be my mortgage.

Anything else I need to be aware of?

G_M

Will he be paying you rent?
What bills? Just food etc? Utilities? Redecoration costs? Half the cost of new boiler when it breaks?

If he contributes towards the mortgage and/or capital improvements (eg boiler), then he might be obtaining some limited property rights.

If it's just rent and shared expenses like food, he's simply a lodger. Mortgage lenders don't need to know about lodgers. Insurance might - read your policy. See also:

LODGERS (Licencees/Excluded Occupiers)
A lodger (broadly) lives in the same property with a resident landlord & shares facilities. Unlike tenants, lodgers have few rights.

The Housing Act 1988 provides definitions of 'Resident Landlord' & 'same property' (S31 & Schedule 1 (10).

See:

LodgerLandlord (21 tips from solicitor Tessa Shepperson + General information site)

Landlordzone (Various articles on taking in lodgers)

Renting out rooms in your home (Government info)

Rent a Room Scheme (HMRC guide for tax-free income from lodgers)

marksoton

smichr wrote: »

From initial conversations we'll be splitting bills 50.50 probably through a joint account, but for now it'll still be my mortgage.

Be careful with this. Once done you are financially linked and it could potentially in the future affect your credit worthiness.

smichr

But if you call it rent, are you then not getting into murky water with sub-letting?

And Patanne, what sort of rights?

always_sunny

patanne wrote: »

A signed waiver to say the OH has no rights to property.

What is this signed waiver? just a waiver on a piece of paper to frame?

Surely if the OH is not on the mortgage or title would have very little claim on the property?

Pixie5740

If your OH moves in and starts making a contribution towards your mortgage repayments he will start to build up a beneficial interest in the property even though he is not named on the mortgage. The longer this goes on the more interest he will have.

He will not be your lodger. Lodgers do not share a bed with their landlord or live as one household with their landlord planning a future together.

You have to decide whether you are happy for him to build up beneficial interest in the property or for him to move in and split all bills excluding the mortgage 50:50.

Talk to him about it, get his take on it before making a decision either way.

smichr

So ultimately, it all comes down to risk.

We're definitely viewing this as the start of something long term; this thread was more about the legalities and paperwork of bills etc but you raise some good points.

Financially she's in a better position than me, with inherited mbory from family already saved and a promise of a parental contribution at some point in the future. Put together, if she wanted to, she could buy half my flat - but we're both taking the view we need to test he water first!

On the other hand, I bought my flat 18 months ago on new build help to buy, but in a few months am due to receive a trust payment which, with some of my own money, should take me up to about 30% ownership paying off the equity loan.

If the worst does happen and we go our separate ways, I guess we just need to have an understanding of what happens to the contributions made.

Re joint accounts mentioned above - I have a pretty active positive credit history, she is less of a credit user but from current indication the risks of exposure to each other are low.

She is quite poor at shopping around though, so I may need to give her a bit of a money saving kick :P

HappyMJ

always_sunny wrote: »

What is this signed waiver? just a waiver on a piece of paper to frame?

Surely if the OH is not on the mortgage or title would have very little claim on the property?

If only that was true.

The only way to really protect your property is to not allow a partner to move in. You would be better off letting out your property and renting somewhere else together.

Most people are sensible though and wouldn't expect anything back if they've not paid anything towards the mortgage or not paid anything that could be classed as rent and not paid anything towards home improvements or repairs.

As long as you're fairly splitting just the ongoing bills gas, electricity, water and council tax then theoretically the person moving in shouldn't have any beneficial interest.

What would happen though is the home owner is probably going to not have any money left over each month as they are paying the mortgage in full each month. The person moving in may then subsidize them and that payment can be considered as making a payment toward the mortgage even if indirectly made.

All very confusing.

Pixie5740

Sucking and seeing how living together goes before getting a joint mortgage is a good idea. Your OH could put the equivalent of half the mortgage payment away in a savings account for a couple of years and then if everything is still rosy she could use that money to put towards a joint mortgage with you for this property or another property.

G_M

Pixie5740 wrote: »

Sucking and seeing how living together goes before getting a joint mortgage is a good idea..

Pixie! Keep it clean!

Pixie5740

:rotfl::rotfl::rotfl::rotfl::rotfl::rotfl:

That does sound much more rude than I meant it to. "Suck it and see," doesn't work as well with the present participle. :embarasse