Rent a room scheme

rizel23

Thanks all.

The additional tax and stamp duty don’t really seem an issue TBH, it is what it is.

So that a side is it possible to allow my brother to remain the property FOC and rent out two additional rooms once remortgaged? On the basis this income is declared and taxed ect thanks

[Deleted User]

rizel23 wrote: »

Thanks all.

The additional tax and stamp duty don’t really seem an issue TBH, it is what it is.

Really? How long will it take you to recover the extra SDLT you will have to pay out? Will the rental income from the two rooms even be enough for the property to wipe its own face?

rizel23 wrote: »

So that a side is it possible to allow my brother to remain the property FOC and rent out two additional rooms once remortgaged? On the basis this income is declared and taxed ect thanks

One for a broker methinks. You're not a home owner and will need some kind of BTL mortgage. Not sure if regulated since your brother will live there even if he's living FOC.

rizel23

Thanks.

The mortgage is relatively cheap, and two rooms would more than cover it with some spare.

By time we choose to buy another property we will likely have £60k in savings plus the equity in this property which will be increasing annually.

My thinking is in just two years of mortgage payments on this remortgage our equity in this property will have significantly increased as I intend to overpay the maximum I can whilst proving a home for my brother short term, i May well then change to a full BTL but that’s not feasible at the moment as he needs somewhere to live.

My only concern was that the income declared on letting two rooms was taken into account for a second home purchase in two/three years time.

Whilst this is not your usual approach there is s clear logic as to why I need to do this. The 75% equity that will be released will pay off my parents home as it is an interest only at a silly rate and allow them to retire.

Thanks