Stamp Duty Dilemma

stemarsbar

Hi everyone,

Really needing some advice here.

Me and my partner have found the perfect property and want to put an offer on it (Around £163,000) but we're a bit confused about stamp duty.

I have not owned a house before but my partner has a buy-to-let and also has a residential mortgage on a house where his dad lives (dad pays rent to my partner though). We are currently renting a house together.

We're already quite tight on funds but have enough for a 5% deposit (around £8700).

We're not sure if we have to pay £5625 on stamp duty because of my partner having other properties :eek: or if there is some way to pay £750 or nothing (!) as it would our first house together and my first mortgage?

I don't earn enough to have the mortgage in my own name.

Thanks in advance...even if it's news we do not want to hear!

G_M

my partner has a buy-to-let and also has a residential mortgage on a house where his dad lives (dad pays rent to my partner though). We are currently renting a house together.

So partner owns 2 properties already, both let out.

Neither is his main residence, nor being replaced/sold.

Partner is adding a 3rd property to his portfolio - SDLT is payable at the additional rate.

AnotherJoe

Your solicitor should have been able to confirm that you do indeed have to pay the full £5625 (not checked that amount) SDLT because you are treated as "one unit" when buying like this.
It's very clear no grey areas here.

saajan_12

stemarsbar wrote: »

Hi everyone,

Really needing some advice here.

Me and my partner have found the perfect property and want to put an offer on it (Around £163,000) but we're a bit confused about stamp duty.

I have not owned a house before but my partner has a buy-to-let and also has a residential mortgage on a house where his dad lives (dad pays rent to my partner though)-does he have consent to let from the lender? A residential mortgage usually requires that the borrower live there, even a normal BTL mortgage may preclude LL's family living there. . We are currently renting a house together.

We're already quite tight on funds but have enough for a 5% deposit (around £8700). - have you thought about solicitor costs, mortgage fees, survey fees, removals costs..?

We're not sure if we have to pay £5625 on stamp duty because of my partner having other properties :eek: or if there is some way to pay £750 or nothing (!) as it would our first house together and my first mortgage? - first house together is irrelevant, else everyone could add a 1% FTB to reduce their SDLT. Its the union of properties owned by each of you, ie two. First mortgage is irrelevant, as there's no distinction based on th eborrowing.. legally one would still own the property.

I don't earn enough to have the mortgage in my own name.

Thanks in advance...even if it's news we do not want to hear!

You do owe the additional rate SDLT, no two ways about it. The ways to avoid it would be
1) sell other two properties before completion on new property.
2) IF partner lived in dad's home as his main residence in the last 18 months and sells it within 18 months after buying the new property, you may be able to claim a refund on the additional SDLT. Lots of "if"s there.

stemarsbar

Thanks for your help everyone. I thought that might be the case...Looks like we might have a bit more saving to do!