Can parent live in my house rent-free when I move abroad?

ArcadeFire

Hi all,

I own a house with a mortgage (around 80% of loan still outstanding). I am planning to move abroad shortly and would like to have my dad live rent-free in the property. A couple of questions I'd love your help with:

1. Am I able to have my dad live rent-free in the property without switching to a BTL mortgage? He would effectively be a property guardian while I am gone (although I don't know when I will be back!), and I won't charge him anything to live there. My preference would be to have him as a lodger, but I can't do that because I won't be resident in the property.
2. Do you know how insurers would respond to this kind of situation? My insurance covers the property for unoccupied periods of up to 45 days. But am I likely to be able to change the insurance so that the property is not classified as unoccupied, if my dad lives there rent-free? Or would insurers only allow this if it were a formal letting set-up?

Thank you!

AdrianC

If your father lives there, then the property is definitely not unoccupied, is it? He's occupying it.
Insurers don't much care who's living there - they care that somebody will notice a minor leak before the whole house floods...

As for your mortgage lender - you really need to ask them. If it's short-to-medium term, and he still maintains a residence elsewhere, then I can't see it being an issue. If it's open-ended and this is his only home, then it may be a bit more of an issue.

Martin_the_Unjust

Will you be removing all your stuff from the house? If not it doesn’t seem to much of a stretch to call your Dad a lodger.

Personally I would just go ahead and do it, then apologise afterwards if I needed to.

greatcrested

Well he's not a tenant unless/until he pays you. 'Pay' can = rent, or anything that is a substitute for rent eg if he repaired/replaced the roof for you that could be construed as rent in kind. Or if he got a new kitchen fitted for you etc.

He's not a 'lodger' unless you live there. You could 'get away' with claiming you live there if all your stuff remains there, but it's a stretch - clearly your main residence is going to be overseas somewhere. I'm guessing here, but are you going to be non resident for tax purposes? Hmmmm.... so not living with dad then.....

But he'd be living there under a licence (permission from you which you can withdraw at the drop of a hat), as an 'Excluded Occupier' so far as the Housing Act is concerned.

I doubt your insurer will care, though read the policy carefully- there may be a clause saying the property must be your main residence. That sort of thing could become critical in a claim following a fire for example.

Similarly I doubt your mortgage lender will care provided payments continue (note: if dad pays the mortgage for you, that = rent. See above!). Their concern would be the ease with which they could evict him if payments stopped and they repossessed.

But I'd consider carefully before asking, especially by phone. Call Centre staff often have poor understanding of distinctions like 'tenant', lodger', 'excluded occupier', and you may simply open a can of worms. And as the call will be recorded, if they tell you "You must apply for a BTL mortgage", and then you don't, that will be on record.

Just saying........