Buying a house / ending HMO tenancy

homeless9

Hi People,

I am currently going through the process of purchasing a house, all seems to be going fine....

I currently live in a HMO (House of Multiple Occupation) and I'm on a rolling month by month contract. I have a feeling my house purchase may complete in very early April and I have not given notice to my landlord yet, therefore I could end up in my new property whilst also having to pay my rent for next month....I HAVE TO pay rent for April on April 1st. It will almost certainly be the last month's rent I pay....but I may be paying it and not even living in this rental property.

I have 2 questions:

1. Is it easy to push a completion date back?.... so that I don't end up paying my first mortgage payment on top of the rental payment for April. So arranging a completion date of May 1st. Paying the mortgage from that date and completing my tenancy in this HMO.

2. If not, what's the situation with simply not paying my last months rent and letting the landlord hold onto my deposit? My deposit is about £40 less than my monthly rent, so I'd save that £40, it's not much, but better than nothing. Not sure the landlord would lose out much here either as I would not be living in the house using water/electricity, and I could also possibly give them more than a months notice which will give them more time to get a new tenant. Not sure how easy it is for the landlord to get back the deposit out of the deposit scheme and into their bank account in this instance? How would the deposit scheme people know I have left without paying my last payment? Would I need to contact them for the landlord?

alex_163163

Just a thought to add to question 1.
if the last day of your rental contract is 30th April (calendar month period 1st to 30th), won’t completion also need to be on 30th April? Otherwise where will you live overnight before you get your keys you the new house?

oldbikebloke

I note you do not refer to exchange of contracts but jump straight in using the word completion. Do you understand the significance of the difference? Why do you think the purchase would complete on 1st May? That is a relatively tight timescale for some house purchases if you have not even exchanged yet.

you could play hardball as you suggest. We have no idea how YOUR landlord will react 
- deposits are to cover claims for any damages done to the property identified as part of the check out process. 

- your tenancy agreement (the original one) may include a standard clause saying a deposit may not be used for final months rent as obviously the LL then has no money from which to claim damages. Technically, if that is the case, the LL could sue you for unpaid rent, realistically though the LL is most certainly going to inform the deposit scheme what you have done and prevent the deposit being returned to you and then may sue you for any remaining shortfall such as balance of rent owed + cost of damage done to their property .

- who is your vendor? Have you asked them about completion dates? We have never met them and have no idea how they will react. They may be tied into a chain, so their vendor is unable to accommodate a change in dates. They ,may be a house builder who won't want to lose a buyer over a short delay,

warby68

I know this isn't what you are asking but not having the funds for a short rental/mortgage overlap which is quite hard to avoid even if only a week or two raises a question. You do need a bit of a contingency fund for house buying. If you have the cash but simply don't want to pay what you see as double, be a little wary of hacking off the other parties to your transactions by not paying rent or trying to push back completion dates with a vendor who is trying to plan their onward move as well. Being 'reasonable' is worth a few hundred quid in the house buying and moving game. If you're lucky you can negotiate a gap between exchange and completion which will mean you are as safe as you can be to give notice on the rental and also reduce the overlap by the size of the gap. Having 2 places for a few days is by no means a disaster either - means you can take your time moving or get any problems fixed before you move in. Prudently , also check when your first mortgage payment will be - there will probably be some point in a month where payment will be rolled over to the next one so better for cashflow.

MCI

Almost everyone I know, including us right now, have an overlap between renting and buying their first place. To be honest it's been really lucky to have somewhere to live while decorating and figuring out the quirks of the house. We've also been able to move boxes up ahead of actually moving our furniture so it's not everything all at once.

paddyz

Check your notice period, pay your last months rent, totally unfair to landlord not to pay, check with lender on what date first payments due after moving in that will give you the information you need to plan everything 

If you have an overlap just means you have more time for getting the place sorted before you are in.

Dancer11

Same for us, we have a 2 week overlap between renting and completing on our new build. None of the stress of moving in on completion day!

akira181

The purpose of giving notice is so you and your LL can close out your rental agreement, check for damages, inventory, cleaning, finding a new tenant, etc.  You just leaving and not paying your rent because it's cheaper and easier for you to forfeit your deposit is not the right thing to do and as you've said yourself; your deposit doesn't cover the rent nevermind any potential damages the LL may identify in addition.  You certainly wouldn't be happy if the roles were reversed.

Completion dates take time as there are banks, solicitors, etc involved and that comes with a ton of paperwork to go back and forth.  An overlap will make the move more pleasant too as it will give you time to move all your stuff over to the new place and time to clean and close out your old.  I imagine it will be very difficult to do without an overlap and for the sake of a few hundred quid, it's not worth the hassle imo, moving is stressful enough and always takes longer than you think.  Doing it all on one day will likely mean the old place isn't cleaned properly and your first night in your new place will be in a sleeping bag on the floor surrounded by boxes.

Also, isn't the first mortgage payment in the first full month after completion?  So if you move beginning of April, your first payment is a higher payment in May?