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1st time buyer, tenants in the house
MoLatif
Posts: 38 Forumite
Hello,
Had an offer accepted on a 2 bed house in the NE to live in myself, mortgage in place and solicitors about to be instructed.
My problem is that there are tenants in it at the moment and am worried that my mortgage lender wont put up the money until theyve gone.
The story is is that they are family members of the landlord and will leave on completion but I have read that lenders will only pay up if the house is vacant at the exchange stage.
What extra paper work woyld i need from the owner for the lender to release funds before vacant possession?
If the property was to be sold on a full vacant possession basis then the tenants decided to stay put, what coyld I do then?
Thanks to you.
Mohammed
Had an offer accepted on a 2 bed house in the NE to live in myself, mortgage in place and solicitors about to be instructed.
My problem is that there are tenants in it at the moment and am worried that my mortgage lender wont put up the money until theyve gone.
The story is is that they are family members of the landlord and will leave on completion but I have read that lenders will only pay up if the house is vacant at the exchange stage.
What extra paper work woyld i need from the owner for the lender to release funds before vacant possession?
If the property was to be sold on a full vacant possession basis then the tenants decided to stay put, what coyld I do then?
Thanks to you.
Mohammed
0
Comments
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It is very simple. DO NOT exchange contracts until the tenants have left.Should've = Should HAVE (not 'of')
Would've = Would HAVE (not 'of')
No, I am not perfect, but yes I do judge people on their use of basic English language. If you didn't know the above, then learn it! (If English is your second language, then you are forgiven!)0 -
100% what pinkshoes said.
If your solicitor is on the ball they won't allow it anyway, but keep it simple, first make sure the seller knows this and agreed, second I would physically check they have moved out before telling solicitor to go ahead with exchange.0 -
If the property was to be sold on a full vacant possession basis then the tenants decided to stay put, what coyld I do then?
You would need to take legal action against the seller and the seller would need to begin eviction proceedings which could easily take several months, worst case more than six months.0 -
The exchange stage doesn't involve the lender at all, so no, the lender won't care what the position is at exchange. But you ought to.The story is is that they are family members of the landlord and will leave on completion but I have read that lenders will only pay up if the house is vacant at the exchange stage.
What matters from the lender's point of view is that you get vacant possession at completion - how that is achieved is up to everyone else.0 -
Oops please remove double posting by mistake.0
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The seller says they are family, they may or may not be. This is probably a seller who wants tenants in paying rent whilst the purchase is going through. You/your solicitor will need to see a S21 has been issued, and the tenants have left before exchange takes place. Not on completion as the vendor has suggested. If the tenants have no where to go (need social housing) they will be advised by the council to not leave until a possession order has been obtained and bailiffs arrive to evict them. This can take months. Not saying this will happen, but it can.
Ideally, the vendor should have had the tenants move out before placing the property on the market, but you can guess why that hasn't happened.
If exchange did take place with tenants in place, and the tenants are still there on completion, you become their LL and will have to deal with eviction proceedings and returning their deposit, repairs etc.
Even if the tenants do leave, you need to see the empty property to assess what repairs are needed, if any, and start negotiating with the vendor, again before exchange has taken place0 -
deannatrois wrote: »The seller says they are family, they may or may not be. This is probably a seller who wants tenants in paying rent whilst the purchase is going through. You/your solicitor will need to see a S21 has been issued, and the tenants have left before exchange takes place. Not on completion as the vendor has suggested. If the tenants have no where to go (need social housing) they will be advised by the council to not leave until a possession order has been obtained and bailiffs arrive to evict them. This can take months. Not saying this will happen, but it can.
Ideally, the vendor should have had the tenants move out before placing the property on the market, but you can guess why that hasn't happened.
If exchange did take place with tenants in place, and the tenants are still there on completion, you become their LL and will have to deal with eviction proceedings and returning their deposit, repairs etc.
Even if the tenants do leave, you need to see the empty property to assess what repairs are needed, if any, and start negotiating with the vendor, again before exchange has taken place
That's not entirely correct. The contract will specify vacant possession to be provided on completion. You should check the property is actually empty on completion day, then phone your solicitor to say he can release the money to the vendor. If you do this right, there's no danger at all of becoming an accidental landlord.
If the tenants are still there on completion day, you simply don't complete. You serve a notice to complete on the vendor.
The advice that the property should be vacant before exchange is a bit overly cautious. What do you do if the vendor refuses? By that time you've already spent most of your costs, anyway.No reliance should be placed on the above! Absolutely none, do you hear?0 -
You can of course look for a different property, but this one may be well priced because there are tenants in.No reliance should be placed on the above! Absolutely none, do you hear?0
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That's not entirely correct. The contract will specify vacant possession to be provided on completion. You should check the property is actually empty on completion day, then phone your solicitor to say he can release the money to the vendor. If you do this right, there's no danger at all of becoming an accidental landlord.
If the tenants are still there on completion day, you simply don't complete. You serve a notice to complete on the vendor.
The advice that the property should be vacant before exchange is a bit overly cautious. What do you do if the vendor refuses? By that time you've already spent most of your costs, anyway.
What if the tenants leave the place a tip or worse ? If you insist on vacant at exchange you can check condition and renegotiate if needed.0 -
AnotherJoe wrote: »What if the tenants leave the place a tip or worse ? If you insist on vacant at exchange you can check condition and renegotiate if needed.
The OP did not mention what he thinks about the price. Perhaps it's worth spelling out that this property is a bit more problematic than an owner occupied one. Hence, that should be reflected in the price. If not, the OP should find somewhere else.
If it is a good price, then I don't think the buyer can have it both ways.No reliance should be placed on the above! Absolutely none, do you hear?0
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