Living in parents home?

louiserobined

I am wanting a bigger property but struggling to find something in my price range. My parents have suggested swapping houses - they are mortgage free now. So I would be living in their bigger home but paying the mortgage on my smaller property whilst they live in it.
Is this something that is possible? Are their any problems with this situation? Thanks :j

getmore4less

Your lender won't like it.

(if they find out)

Is this intended to be a proper swap of ownership even if delayed?

There are complications with this arrangement CGT being one of them.

Foofoopuppy

Is it supposed to be permanent? If so can you not do it legally i.e your parents sell their house to you for the amount you can afford and you sell yours to them? You will need to make you lender aware of the undervalue, and your solicitors.

diggingdude

Foofoopuppy wrote: »

Is it supposed to be permanent? If so can you not do it legally i.e your parents sell their house to you for the amount you can afford and you sell yours to them? You will need to make you lender aware of the undervalue, and your solicitors.

Don't forget stamp duty and fees

00ec25

diggingdude wrote: »

Don't forget stamp duty and fees

indeed,
if OP is gifted (ie becomes owner of) the parent's (larger) property then he would have to pay SDLT based on the market value of his own (lower value) property

you cannot swap ownership of houses and expect to escape SDLT
https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm04020a

if ownership does not change hands, clearly SDLT is irrelevant

lookstraightahead

It's the same as if you weren't related. You're all independent adults so it's like a stranger swapping with another and paying someone else's mortgage. How would the lender feel about that?

G_M

[QUOTE=louiserobined;76114381.....My parents have suggested swapping houses - they are mortgage free now. So I would be living in their bigger home but paying the mortgage on my smaller property whilst they live in it.

so they would be paying you rent (in the form of your mortgage).

[/QUOTE]

You would have to declare this income toHMRC, as well as comply with all landlord and tenant leglislation and regulations.


Oh - and your respective insureres would need to be told: your insurance will be be currently based on your being owner-occupiers, but if you live elsewhere your insurance will be invalid.

* New landlords (1):advice & information :see links in next post

* New landlords (2): Essential links for further information

markin

lookstraightahead wrote: »

It's the same as if you weren't related. You're all independent adults so it's like a stranger swapping with another and paying someone else's mortgage. How would the lender feel about that?

She didn't say they would be paying her mortgage, so its down to insurance, And would the lender care if she moved out but leaving her family in?

louiserobined

Thanks for feedback all... sounds like a minefield I guess I will just stick to looking at houses! Thanks