Confused! FTB, LISA, second home?!

Lizw245

I'm going to be a first time buyer, and have a LISA. My partner already owns a house and has done for 5 years. Is it possible for us to buy together, and for him to keep his house and rent it out? I don't understand how it would work with mortgages and how much we'd be entitled to? Would his house have to be rented out for 6 months before he would be allowed a mortgage amount that reflected his wage and deposit? Lots of questions, but I hope someone can shed some light on this please. Thanks!

Cakeguts

The first thing you have to do is to work out how much you can afford to borrow for the home that you want to buy together when you have to be able pay the mortgage on the two properties without any extra income than what you have now.



The reason for this is because if you get a bad tenant who doesn't pay the rent you will need to be able to pay both mortgages for most of a year while you wait for a court date in order to start the eviction process. As well as paying both mortgages you will also have to carry on paying for repairs on the let house if they are needed even though you are not getting any rent.



If you think that you will not be able to afford to pay both mortgages then your partner will need to sell his house.



Many properties that are bought for the owners to live in do not make good rental properties so the chances of getting a bad tenant is higher than if the property was bought to let only.

Tom99

Remember apart from all the other considerations you will pay an extra 3% stamp duty on the whole purchase price of your new property if your partner keeps their existing property to let out.

[Deleted User]

You can use your LISA for the purchase and the purchase will be subject to the higher rate of SDLT.

Keeping his current property might impact the amount you can both borrow depending on whether his current home generates enough rental income to be considered self financing.