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BTL mortgage with intention to rent to child
Bad_Ash
Posts: 56 Forumite
My wife had an offer on her house today. We were advised it was a cash buyer who was buying for their child. The EA then asked for proof of funds, and the story changed slightly, they would probably require a small BTL mortgage...
Am I correct in thinking that it will be difficult / impossible to get a BTL mortgage if the mortgage company are aware the tenant will be a close relative?
Am I correct in thinking that it will be difficult / impossible to get a BTL mortgage if the mortgage company are aware the tenant will be a close relative?
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Comments
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They could get a residential mortgage if they were "only" letting to their child.
Not really your problem what they tell their lender. You would be no party to the transaction.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
Not really your problem what they tell their lender. You would be no party to the transaction.
I should have clarified, the reason for my concern is that if she was to accept the offer, there is a risk the sale could fall through due to the buyer not being able to secure a mortgage (if the mortgage provider were to find out the full details).
The offer is fairly low, which I think they were justifying by being a 'cash buyer'. However, now I know their real circumstances, I consider the offer not only low, but also with a reasonable risk of falling through, hence not being particularly attractive.0 -
They aren't a cash buyer. They need a mortgage like anyone else who might make an offer. There is nothing special about their offer if they need a mortgage so there is no point an accepting a low offer because they lied about having cash.
Have you had any other offers? How long has the house been on the market?0 -
Typically lenders refuse to lend to landlords where the tenant is family.
Apparently Mansfield BS have just announce a product for this type of situation.0 -
Thanks for the responses.
She ended up accepting a slightly increased offer from this buyer. Unfortunately he pulled out almost immediately stating he had not anticipated the stamp duty costs, as it's was a second home it would be ~£7.5k (compared to £1.5k). Something for us to consider for any future offers from potential first time landlords.0 -
Sounds like they were very unprepared to purchase and had no little if no research.0
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