BTL mortgages

bobbymotors

Hello all, grateful for any help.

I own 3 rental houses, each worth £350k.

The mortgages on them are minimal, £38k, £91k and £130k respectively

The 3 BTL mortgages are interest only and expire 2019, 2021 and 2026 respectively.

I am 60 my wife is 70, the houses are owned her, her, me respectively.

We are happy to gift / own jointly / change ownership as needed.

What is our way forward to get fresh BTL mortgages on these please? Just ask current lenders? Will we get 25 year interest only mortgages at our age(s)?

Thanks in advance

Bob

flashg67

Can't offer any useful advice except to say that my recent BTL mortgages will take me well past my 70th birthday (eek!) - I'd suggest speaking to a broker as well as your current lenders.

What nice position to be in - I'd be tempted to sell up, move to Spain and avoid all the new anti-landlord tax changes!

bobbymotors

flashg67 wrote: »

Can't offer any useful advice except to say that my recent BTL mortgages will take me well past my 70th birthday (eek!) - I'd suggest speaking to a broker as well as your current lenders.

What nice position to be in - I'd be tempted to sell up, move to Spain and avoid all the new anti-landlord tax changes!

Thank you, yes, it is a nice position to be in, but it wasn't easy: I grafted my socks off for 35 years!

I know what you're saying about selling up...but the CGT would be horrendous, and as the years pass we'd like to gradually give our son the properties so that he can get off the treadmill.

flashg67

Well done you, and your son is a lucky lad! I'm trying to do the same myself but left it a bit late. It is hard work being a landlord as well holding down a full time job, but rewarding in the end (hopefully).

anselld

bobbymotors wrote: »

as the years pass we'd like to gradually give our son the properties

(1) the CGT will still be horrendous.
(2) so why do you want to remortgage for 25 years?

bobbymotors

anselld wrote: »

(1) the CGT will still be horrendous.
(2) so why do you want to remortgage for 25 years?

Surely the CGT will only be horrendous once the properties are actually sold? If they are gifted to my son then as long as Ii live for 7 years is that not ok? I don't know how this all works.

I would like to handover (gift) the properties once i am in my early 70s...wife will be mid 80s (i hope!)

So a 15 year remortgage would do the job. And my son can get his own BTL mortgages.

bobbymotors

Back to CGT

Does 'hold over relief' not apply, ie my son would pay tax on resale and the CGT would be calculated on original cost?

anselld

bobbymotors wrote: »

Back to CGT

Does 'hold over relief' not apply, ie my son would pay tax on resale and the CGT would be calculated on original cost?

You might want to ask that again in the Cutting Tax board but Holdover Relief only applies in certain limited circumstances ...
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/384038/hs295.pdf
... and I don't think Residential Property is one of those.

silvercar

bobbymotors wrote: »

Surely the CGT will only be horrendous once the properties are actually sold? If they are gifted to my son then as long as Ii live for 7 years is that not ok? I don't know how this all works.

I would like to handover (gift) the properties once i am in my early 70s...wife will be mid 80s (i hope!)

So a 15 year remortgage would do the job. And my son can get his own BTL mortgages.

The only easy way to avoid CGT is not to sell. If you still own the properties on death, you avoid CGT but they form part of your estate.

There are other, more tiresome, ways. You could gift him a 10% share in each property every year. Just to use your CGT allowance. But that would mean becoming joint owners. Also consider your son's position - owning a second property could trigger an extra 3% SDLT liability in certain circumstances.

ViolaLass

Does your son want the three properties or would he rather have the money? That could affect the decisions you make.

bobbymotors

silvercar wrote: »

The only easy way to avoid CGT is not to sell. If you still own the properties on death, you avoid CGT but they form part of your estate.

There are other, more tiresome, ways. You could gift him a 10% share in each property every year. Just to use your CGT allowance. But that would mean becoming joint owners. Also consider your son's position - owning a second property could trigger an extra 3% SDLT liability in certain circumstances.

I wasn't planning on selling them to him, more an outright gift. if i survive 7 years then no IHT I believe.

But if it means CGT is payable on the gift there is no point.

As for his selling them, once they are his its up to him,but my advice to him would be to keep them as it will mean he is off the treadmill!