Selling a house that's currently rented out

GDB2222

It’s going to be doubly difficult to get a BTL mortgage with the current tenants paying below market rent, as the mortgage will be assessed against the income.

gazfocus

Sea_Shell said:

Boat_to_Bolivia said:

gazfocus said:

Also, should have mentioned, they have made it perfectly clear that they are no going to move to 'just anything' and are being very specific about what they're looking for.

Seems you have a fight on your hands. Very sorry for you OP, after doing your relatives a good deed, they are not going to leave quietly. All the best.

* OP - What did you 'promise' them when the tenancy started, even if only verbal or even just inferred?   Have they a right to feel mislead too?

Nothing was promised as such. They said they would rent the house for as long as they were able, and I said we'd rent it to them for as long as I can. I explained to them about the consent to let but none of us expected it to not be renewed after just 12 months.

Sea_Shell

gazfocus said:

Sea_Shell said:

Boat_to_Bolivia said:

gazfocus said:

Also, should have mentioned, they have made it perfectly clear that they are no going to move to 'just anything' and are being very specific about what they're looking for.

Seems you have a fight on your hands. Very sorry for you OP, after doing your relatives a good deed, they are not going to leave quietly. All the best.

* OP - What did you 'promise' them when the tenancy started, even if only verbal or even just inferred?   Have they a right to feel mislead too?

Nothing was promised as such. They said they would rent the house for as long as they were able, and I said we'd rent it to them for as long as I can. I explained to them about the consent to let but none of us expected it to not be renewed after just 12 months.

On the upside, it could have been worse...they could have not paid their rent!!!


Hopefully they won't now withhold rent to enable them to save for their next place.    Unless of course you are prepared to offer them a "sweetener" of a further discount or payment holiday to help them on their way.

gazfocus

GDB2222 said:

It’s going to be doubly difficult to get a BTL mortgage with the current tenants paying below market rent, as the mortgage will be assessed against the income.

I've just gone through a BTL calculator and even if we could get a BTL mortgage, they'd need to pay an extra £450 a month to meet the 125% of the mortgage payment figure. Can't see them going for that but can always put it forward as an option to them.

Wonka_2

gazfocus said:

GDB2222 said:

It’s going to be doubly difficult to get a BTL mortgage with the current tenants paying below market rent, as the mortgage will be assessed against the income.

I've just gone through a BTL calculator and even if we could get a BTL mortgage, they'd need to pay an extra £450 a month to meet the 125% of the mortgage payment figure. Can't see them going for that but can always put it forward as an option to them.

But in an earlier post you've quoted that market rent (or everything in the area) is c.£500 more than they're currently paying so £450 isn't out of the ballpark. The issue then becomes, even if BTL is an option, can they actually afford it - and if they can't then they've obviously got to find somewhere within their means  

gazfocus

Wonka_2 said:

gazfocus said:

GDB2222 said:

It’s going to be doubly difficult to get a BTL mortgage with the current tenants paying below market rent, as the mortgage will be assessed against the income.

I've just gone through a BTL calculator and even if we could get a BTL mortgage, they'd need to pay an extra £450 a month to meet the 125% of the mortgage payment figure. Can't see them going for that but can always put it forward as an option to them.

But in an earlier post you've quoted that market rent (or everything in the area) is c.£500 more than they're currently paying so £450 isn't out of the ballpark. The issue then becomes, even if BTL is an option, can they actually afford it - and if they can't then they've obviously got to find somewhere within their means  

Correct, so IF (and it's a big IF), I am able to get a BTL mortgage on the property, the rent will need to go up to almost market value. There's literally nothing I can do about that, so then it will become a choice between staying and paying more to cover the BTL or move out and allow us to sell up. 

Sea_Shell

gazfocus said:

Wonka_2 said:

gazfocus said:

GDB2222 said:

It’s going to be doubly difficult to get a BTL mortgage with the current tenants paying below market rent, as the mortgage will be assessed against the income.

I've just gone through a BTL calculator and even if we could get a BTL mortgage, they'd need to pay an extra £450 a month to meet the 125% of the mortgage payment figure. Can't see them going for that but can always put it forward as an option to them.

But in an earlier post you've quoted that market rent (or everything in the area) is c.£500 more than they're currently paying so £450 isn't out of the ballpark. The issue then becomes, even if BTL is an option, can they actually afford it - and if they can't then they've obviously got to find somewhere within their means  

Correct, so IF (and it's a big IF), I am able to get a BTL mortgage on the property, the rent will need to go up to almost market value. There's literally nothing I can do about that, so then it will become a choice between staying and paying more to cover the BTL or move out and allow us to sell up. 

Just be prepared for them not to make that "choice" to do either...until forced ☹️, whilst hoping you can resolve the situation amicably.

gazfocus

Sea_Shell said:

gazfocus said:

Sea_Shell said:

Boat_to_Bolivia said:

gazfocus said:

Also, should have mentioned, they have made it perfectly clear that they are no going to move to 'just anything' and are being very specific about what they're looking for.

Seems you have a fight on your hands. Very sorry for you OP, after doing your relatives a good deed, they are not going to leave quietly. All the best.

* OP - What did you 'promise' them when the tenancy started, even if only verbal or even just inferred?   Have they a right to feel mislead too?

Nothing was promised as such. They said they would rent the house for as long as they were able, and I said we'd rent it to them for as long as I can. I explained to them about the consent to let but none of us expected it to not be renewed after just 12 months.

On the upside, it could have been worse...they could have not paid their rent!!!


Hopefully they won't now withhold rent to enable them to save for their next place.    Unless of course you are prepared to offer them a "sweetener" of a further discount or payment holiday to help them on their way.

That is indeed a concern that I've already discussed with my wife, though I sincerely hope that doesn't happen otherwise the house is more likely to be repossessed due to mortgage arrears than anything else.

gazfocus

Sea_Shell said:

gazfocus said:

Wonka_2 said:

gazfocus said:

GDB2222 said:

It’s going to be doubly difficult to get a BTL mortgage with the current tenants paying below market rent, as the mortgage will be assessed against the income.

I've just gone through a BTL calculator and even if we could get a BTL mortgage, they'd need to pay an extra £450 a month to meet the 125% of the mortgage payment figure. Can't see them going for that but can always put it forward as an option to them.

But in an earlier post you've quoted that market rent (or everything in the area) is c.£500 more than they're currently paying so £450 isn't out of the ballpark. The issue then becomes, even if BTL is an option, can they actually afford it - and if they can't then they've obviously got to find somewhere within their means  

Correct, so IF (and it's a big IF), I am able to get a BTL mortgage on the property, the rent will need to go up to almost market value. There's literally nothing I can do about that, so then it will become a choice between staying and paying more to cover the BTL or move out and allow us to sell up. 

Just be prepared for them not to make that "choice" to do either...until forced ☹️, whilst hoping you can resolve the situation amicably.

I've emailed our mortgage adviser with a full copy of mine and my wifes credit reports to see what she thinks of our chances. If she feels confident she'll get us a BTL, I'll put the option across to the family member and give them the choice (at the end of the day, if it's pay the market rate where I already live or move and start all over again somewhere else and still pay the market rate, I know which I'd choose), and if they can't afford it, I'll just have to give then a deadline for moving out so I can get the house sold.

MattMattMattUK

gazfocus said:

Sea_Shell said:

gazfocus said:

Sea_Shell said:

Boat_to_Bolivia said:

gazfocus said:

Also, should have mentioned, they have made it perfectly clear that they are no going to move to 'just anything' and are being very specific about what they're looking for.

Seems you have a fight on your hands. Very sorry for you OP, after doing your relatives a good deed, they are not going to leave quietly. All the best.

* OP - What did you 'promise' them when the tenancy started, even if only verbal or even just inferred?   Have they a right to feel mislead too?

Nothing was promised as such. They said they would rent the house for as long as they were able, and I said we'd rent it to them for as long as I can. I explained to them about the consent to let but none of us expected it to not be renewed after just 12 months.

On the upside, it could have been worse...they could have not paid their rent!!!


Hopefully they won't now withhold rent to enable them to save for their next place.    Unless of course you are prepared to offer them a "sweetener" of a further discount or payment holiday to help them on their way.

That is indeed a concern that I've already discussed with my wife, though I sincerely hope that doesn't happen otherwise the house is more likely to be repossessed due to mortgage arrears than anything else.

Are these family members reasonable people? Reading between the lines I am getting the impression that they are at the other end of the scale and will happily screw you over for short term gain.