Helping Family, Disaster or Triumph?

BM5118

Thanks guys
Initially I hadn't thought of a BTL mortgage, I was thinking of a normal first time buyer mortgage and her living there paying an amount equal to the mortgage. Obviously I hadn't thought this through at all.


So, does anyone know how it could work if I had her as a lodger? Would she need a tenancy agreement and would I need all the safety checks etc under this kind of arrangement? Would I need to ask my lender for permission?



The shared equity thing/ sharing improvement costs sounds like a nightmare. So I would avoid that. It would be entirely my house, if she wishes to buy it at a later date that would be a separate issue to sort out then.



A 5 second google just revealed If I had a lodger paying rent and the first 7500 is tax free. On this matter, if tax is due, how do you calculate at what rate it is paid? and can this be taken out of my paycheck or is that something I have to pay directly to HMRC?

Pixie5740

If you're not living there how could your aunt be a lodger?

BM5118

Pixie5740 wrote: »

If you're not living there how could your aunt be a lodger?

How often are you required to live in a property to say its your home?
I will certainly go every weekend like we usually do. I stay at my parents fairly regularly too when im not at work. Essentially whilst at work I stay in the work accommodation or I am abroad. When off work, I tend to stay at friends/family but rarely in my work house.


I kind of feel the lodger scenario would work rather well, I wouldn't be there most of the time which suits my aunt even better. Just a thought!

Pixie5740

BM5118 wrote: »

How often are you required to live in a property to say its your home?
I will certainly go every weekend like we usually do. I stay at my parents fairly regularly too when im not at work. Essentially whilst at work I stay in the work accommodation or I am abroad. When off work, I tend to stay at friends/family but rarely in my work house.


I kind of feel the lodger scenario would work rather well, I wouldn't be there most of the time which suits my aunt even better. Just a thought!

That's not how it works. For you to have a lodger it has to be your only or main residence and this property would clearly not be either your only or your main residence.

Since your aunt already has £100k in the bank and will soon have another £500k I'm not sure why you're even considering this convoluted plan. Surely she would be able to buy property outright £600k even in Kent. In the case that she did require a mortgage then with a sizable deposit it could still be possible.

If you want to invest in buy to let then do the maths (that's maths plural) to see if it stacks up for you but don't enter into some !!!! and bull arrangement with your aunt. I can't see how it would benefit either one of you.

BM5118

Ok thanks everyone. I'm still getting caught up on accomodation so maybe if I explain more it might help. Or maybe you guys can convince me its still a bad idea.

My job comes with accommodation. I travel for work often 2 or 3 days a week, in which my boss gets me a hotel. If I'm at my bosses house he has a cottage on his property which I stay in. I don't pay any bills or council tax or anything. If I lost my job I would lose this accommodation immediately. I also have no tenancy agreement or ties to that property.

On my days off, I very rarely stay in the work cottage, I travel back to my family and stay with them. Usually my parents.

I'm 26, I've never owned a property. I want to buy something that I can go to on my days off rather than staying with family.

Ideally I want to let my aunt live with me who ideally would pay me something similar to what the mortgage amount is. She realistically would live there 7 days a week, I would only be there on my days off. I'm not concerned she won't pay me as mentioned before.

Forget about all renovations etc, that idea clearly is a non starter.

What I get out of it:
My own home
Someone contributing towards bills ideally minimising my expenses.

Someone taking care of the property whilst im away.

Bonus, My aunt will one day probably buy the house off of me if that is what I/she wants at a later date.

Negatives:
Potentially some tax to pay/forms to fill out... not sure thats a negative

I can't really see anymore

Sorry if I'm being pig headed, I just can't see why this wouldn't be a win win scenario.

Pixie5740

BM5118 wrote: »

Ok thanks everyone. I'm still getting caught up on accomodation so maybe if I explain more it might help. Or maybe you guys can convince me its still a bad idea.

My job comes with accommodation. I travel for work often 2 or 3 days a week, in which my boss gets me a hotel. If I'm at my bosses house he has a cottage on his property which I stay in. I don't pay any bills or council tax or anything. If I lost my job I would lose this accommodation immediately. I also have no tenancy agreement or ties to that property.

On my days off, I very rarely stay in the work cottage, I travel back to my family and stay with them. Usually my parents.

I'm 26, I've never owned a property. I want to buy something that I can go to on my days off rather than staying with family.

Ideally I want to let my aunt live with me who ideally would pay me something similar to what the mortgage amount is. She realistically would live there 7 days a week, I would only be there on my days off. I'm not concerned she won't pay me as mentioned before.

Forget about all renovations etc, that idea clearly is a non starter.

What I get out of it:
My own home
Someone contributing towards bills ideally minimising my expenses.

Someone taking care of the property whilst im away.

Bonus, My aunt will one day probably buy the house off of me if that is what I/she wants at a later date.

Negatives:
Potentially some tax to pay/forms to fill out... not sure thats a negative

I can't really see anymore

Sorry if I'm being pig headed, I just can't see why this wouldn't be a win win scenario.

Then go ahead and do it.

BM5118

Pixie5740 wrote: »

Then go ahead and do it.

Well im tempted to :rotfl:
I'm just here trying to work out the pitfalls of it.


I think technically this home would be my main residence. Meaning a BTL mortgage isn't appropriate.


I kind of feel I don't fit in either category perfectly.

Comms69

BM5118 wrote: »

Well im tempted to :rotfl:
I'm just here trying to work out the pitfalls of it.


I think technically this home would be my main residence. Meaning a BTL mortgage isn't appropriate.


I kind of feel I don't fit in either category perfectly.

No it wouldn't be your main residence


You can feel whatever you like, this is a BTL situation.

Red-Squirrel_2

If your Aunt has a job and £100K in the bank she should go to a good mortgage broker and get her own house. It will almost certainly be possible.

She really shouldn't be making her young niece/nephew responsible for her housing. Its not fair.

fairy_lights

I don't see how this is a win-win situation in any way at all.
You say you want your own home to go to on your days off - but it wouldn't be your home would it, it would be your aunts home that you just stay in occasionally.
Have you ever lived with her before? if you disagree about what to watch on tv or what colour to paint the living room it could strain your financial and family relationships.
And if she wants the option to buy the property off you in the future, would this be at full market value or would she be expecting a generous discount?
This could get incredibly messy.