2 mortgages with 2 companies

heatherunited

Hi there 6 years ago we moved into our current address and attempted to sell our other house, this at a time when the recession had a firm hold, we never even got a viewing in 3 months. So our financial adviser asked if we had thought about renting, we didnt really, we just wanted to pay our capital onto the house we wanted (It was my wifes mums and at a price we couldnt possibly miss it was 30k off the asking price, and that we thought was cheap) needless to say we rented the house out with a different firm to the firm that has our own houses mortgage. Now it may be a silly question, but would it be in any way beneficial giving or rental property over to the Halifax (the company who has our own house) maybe in some way, they would take the capital off our own property, ot give us a lower rate. I f I know any mortgage company it wont make a blind bit of difference to give you some numbers on our current house we owe 90k and just been valued at 210k, the rental property we owe 60k and is valued at 110k. I know what you will say sell the rental and take it off your capital on your own house youd only owe 40k. Problem is my son lives in my rental property, hes only just got a job as a bmw technician and ultimately both houses will be his anyway, so is it worthwhile letting the halifax have th other house aswell? Though the house only brings in £150 extra a month its extra, the house is very well maintained as my sons in in it and I can't exactly kick him out! (though sometimes i'd love too lol) As far as I'm aware there is no get out clause of the other house as I just have the normal variable rate and have never changed it for 6 years. Also in times of emergency as my partner is poorly at the moment, though he fully expects to go back to work, its made us think, if things did get bad, he lost his job, would it be better if we went on interest only on our house, they would own our other house which has capital in it and also rental income, the house price goes up as the rental price goes up? Or should we just leave it all as it is? Just thought if the halifax had both, and my wife is 57 and I'm not well at all perhaps if the halifax had both if we did ask to change to interest only they had the other property as a way of making sure the 90k that is outstanding will be paid off (though youd think the 210k that its woth would be enough?) Your thoughts woould be reatly appreciated

HappyMJ

You can't give the property to the bank without incurring a huge amount of fees.

Kick your son out and sell it. If you're not willing to kick him out then you will have to hold on to it and continue to work so you can pay off your mortgage.

Brock_and_Roll

Is the rental property on a Buy to Let Mortgage?


Does the lender know that your son is living there?

Thrugelmir

Are you declaring the rental income to the HMRC?

heatherunited

First of all yes the property is declared to HMRC as its a full £1500 a year extra income, the buy to let mortgage are well aware my son is living there. I have everything inspected yearly such as boiler and certification, I also pay £30 a month landlord and building contents now as you can see all the extras it certainly doesn't take me over any threshold for tax. As for whether the buy to let company knows whether its my son who lives there, yes they do as do the local authority, as my son and gf earn so little they applied for some help, of which they received none. Why is it as soon as you ask for advice all people are bothered about is whether you are breaking the law, I earn around less than £100 a month and before you ask we dont claim any benefits, and some months we dont even charge them the full rent or even rent at all, before you all say how stupid we are and we could be earning an extra ££££ by having tenants in, we are both very happy we can provide a stepping ladder to our son when you all know how difficult it is for youngsters to even survive, they dont claim a penny and work hard. As always on here you ask for advice and all you get is are you breaking any law? We are not and everything is declared, though like I say if we were honest we probably wouldn't break even. I'm afraid as parents, we can't 'kick' our son out, pay the money off our mortgage and we'd hardly owe anything, maybe some parents can and we are in the minority, financially we do know this would be the correct decision. Now all we wanted to know is if we swapped our mortgage to our company would it make a blind bit of difference? I doubt it very much, just thought if my mortgage company knew they had an extra 30k should anything unexpected occurred, like loss of job, redundancy etc. The other house wasnt bought as a get rich quick scheme we lived there 20 years before moving into my wife's mothers house, which like i say was an offer we couldn't refuse. If there is nothing you can add please don't answer, like I say we know whats best financially, but sadly we cant kick our child out, maybe one day when their both earning their own money, they'll move on, we nor them claim a penny off the state and I pray we never do