Buying inherited property from my co-beneficiaries

Malthusian

If 4% gross yield (before tax, expenses and void periods) on an extra-high-risk investment is what you can expect from a "very good rental location" I'd hate to own a property in a bad rental location. With or without the problems of going into business in partnership with an awkward relative.

pencil31

Just to update everyone - all 3 of my co-beneficiaries have agreed to my buy out of their shares. I am just in the process of arranging a mortgage but am being told by the lender that to benefit from their best deals, (ie. remortgage) , I can only do that if I am shown as a owner in whatever form. Otherwise it would be a purchase and incur additional fees. Currently the property is still in my late mothers name. I'm looking into Assenting to our four names , then remortgage to buy out the others. Just wondering though is there an easier way that doesnt circumvent any rules eg. Have the executor assent just to me - rather than all beneficiaries. The process just seems a bit easier if I could do it that way. Otherwise, my siblings need to provide certified copies of ID documents, sign and witness forms etc. etc. Many thanks

AnotherJoe

pencil31 wrote: »

Just to update everyone - all 3 of my co-beneficiaries have agreed to my buy out of their shares. I am just in the process of arranging a mortgage but am being told by the lender that to benefit from their best deals, (ie. remortgage) , I can only do that if I am shown as a owner in whatever form. Otherwise it would be a purchase and incur additional fees. Currently the property is still in my late mothers name. I'm looking into Assenting to our four names , then remortgage to buy out the others.

I'm not sure that would help wouldn't there then be three sets of sale /solicitor /legal fees for them? Can you find a different lender with a more rational less hoop-jumping policy?

pencil31 wrote: »

Just wondering though is there an easier way that doesnt circumvent any rules eg. Have the executor assent just to me - rather than all beneficiaries. The process just seems a bit easier if I could do it that way. Otherwise, my siblings need to provide certified copies of ID documents, sign and witness forms etc. etc. Many thanks

That seems rife with issues. You are then the sole house owner and the others have to trust you to pay them back via a loan agreement of some sort? You'd all have to sign a bunch of documents in that case as well (such as instruments of variation) , and pay for legal advice that you were doing this the right way and no doubt get the agreements witnessed etc.

Just my 2c

Keep_pedalling

You would be better asking this sort of question over on the mortgages board.

getmore4less

Watch out for the lenders that don't like to mortgage a property that has changed hands less than 6 months ago.

the reality is you are buying off the estate

How much more is the interest rate?

A lot of lenders have the same rates for remortgage and purchase and retentions

which lender?

do you have a broker on the case?

With only a 4% gross yield that is right at the bottom of making any money out of this letting business.

relaxtwotribes

getmore4less wrote: »

With only a 4% gross yield that is right at the bottom of making any money out of this letting business.

Property investment is about rental income AND capital gains, so this statement is only part of the equation. A property with a low yield is expected to deliver a high capital gain and a property with a high yield is expected to deliver a low capital gain. The OP believes this property to be in a very good rental location, so 4% may well be an excellent running return.

pencil31

thank you everyone , much appreciate all comments Yes it is correct that the yield is low but also correct that the long term growth potential is good . Tthe lender is the best on the buy to let market at the moment given the stringent rules on rental cover etc. . Will post this on mortgages board as suggested . And also, plan to speak to Land Registry later regarding Assent

Yorkshireman99

pencil31 wrote: »

thank you everyone , much appreciate all comments Yes it is correct that the yield is low but also correct that the long term growth potential is good . Tthe lender is the best on the buy to let market at the moment given the stringent rules on rental cover etc. . Will post this on mortgages board as suggested . And also, plan to speak to Land Registry later regarding Assent

You also need to take the emotional attachment to the property out of the equation. Renting out a property is first, second and third a commercial decision. There may well be much more commercially suitable properties than the one you are planning to buy. Take some hard headed commercial advice first.