Inheriting mortgaged property then renting it out

Ed-1

If you inherit a property that has a loan secured against it (be it a mortgage or otherwise) and you decide to let the property, are the loan interest costs allowable as a basic rate finance costs deduction?

user1977

You won't "inherit" the mortgage, the executors pay off all debts from the estate. If you get a mortgage over it then it will be treated like any other mortgage of a let property.

Ed-1

user1977 said:

You won't "inherit" the mortgage, the executors pay off all debts from the estate. If you get a mortgage over it then it will be treated like any other mortgage of a let property.

It's a legal charge that does pass down under the loan agreement.

AdrianC

Ed-1 said:

user1977 said:

You won't "inherit" the mortgage, the executors pay off all debts from the estate. If you get a mortgage over it then it will be treated like any other mortgage of a let property.

It's a legal charge that does pass down under the loan agreement.

More detail needed, because that sounds very, VERY odd indeed.

The executors would normally need to repay any debt from other assets of the estate, in order to get the charge holder to remove their charge and consent to the change in title.

If there are insufficient assets, then either the property would need to be sold with the charge redeemed as part of the sale, as normal, or a beneficiary wanting to keep the property would pay sufficient into the estate to redeem the charge. They may, then, borrow more in their own name, of course, with a fresh charge...