BTL Horror Story - Advice Needed

Hi,

My dad is having a bit of a nightmare with his current BTL which has a mortgage term maturing in around 2 months.

He is unable to remortgage due to his current financial condition. He gave away the property to a ‘family friend’ who has been acting as an Agent and further sub-letting to someone else (supposedly). For whatever reason, he doesnt have any of the contracts with the Agent or the Tenants and they are not sharing the contracts. He is VERY hands off and didn’t care as long as rent was being received and neither did he know about the mortgage expiration.

Given the mortgage is almost up, the only option he has is to sell the property but hes unable to even access the property as they (agent/tenants) are withholding the keys. The situation is getting quote tense now so looking for some advice on next steps.

Help?


Comments

  • Grumpelstiltskin
    Grumpelstiltskin Posts: 4,125
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    What do you mean ' gave it away '
    If you go down to the woods today you better not go alone.
  • SA789
    SA789 Posts: 22
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    What do you mean ' gave it away '
    Apologies - should’ve phrased this better. It wasn’t given away in the legal sense, he basically handed responsibility for taking care of all aspects of the property to this particular individual, who is supposedly acting in the capacity of an agent.

    Day to day, my dad has had no involvement on any decisions.
  • silvercar
    silvercar Posts: 46,722
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    If there is rental income. He should be able to remortgage based on that on a BTL mortgage.
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  • SA789
    SA789 Posts: 22
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    silvercar said:
    If there is rental income. He should be able to remortgage based on that on a BTL mortgage.
    Thanks for responding. Spoke to a mortgage advisor and rental income isn’t sufficient to cover the size of the loan in the current market. Remortgaging appears to be out of the question.
  • tetrarch
    tetrarch Posts: 241
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    Maybe this is a sign that your Dad is not cut out to be a Landlord and should sell the house. Net net the returns might even improve in the current interest rate environment

    Regards

    Tet
  • Kim_13
    Kim_13 Posts: 2,206
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    edited 5 February at 11:17AM
    tetrarch said:
    Maybe this is a sign that your Dad is not cut out to be a Landlord and should sell the house. Net net the returns might even improve in the current interest rate environment

    Regards

    Tet
    It’s quite clear from the post that the he agrees that the house has to be sold, as he cannot afford to be a Landlord whether or not he is cut out for it. The question is how to achieve that - presumably he doesn’t have thousands for legal fees either so will need advice on what to do/send/issue to handle as much of the process himself as possible. He could offer first refusal of the house to the tenants - selling to them will be a lot easier than trying to gain possession from someone who won’t or can’t leave.

    Not a LL but if this ‘agent’ is being uncooperative would he be breaking any rules by sending a copy of the title deed to the house (proving his ownership) and advising that as from X date this agent no longer represents him and T’s will need to deal with/pay him directly? T’s will need to be given notice for access to the property but he can then start to unpick whether the agent has been compliant with the rules and what steps would be needed to get the house back. 
  • SA789
    SA789 Posts: 22
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    Kim_13 said:
    tetrarch said:
    Maybe this is a sign that your Dad is not cut out to be a Landlord and should sell the house. Net net the returns might even improve in the current interest rate environment

    Regards

    Tet
    It’s quite clear from the post that the he agrees that the house has to be sold, as he cannot afford to be a Landlord whether or not he is cut out for it. The question is how to achieve that - presumably he doesn’t have thousands for legal fees either so will need advice on what to do/send/issue to handle as much of the process himself as possible. He could offer first refusal of the house to the tenants - selling to them will be a lot easier than trying to gain possession from someone who won’t or can’t leave.

    Not a LL but if this ‘agent’ is being uncooperative would he be breaking any rules by sending a copy of the title deed to the house (proving his ownership) and advising that as from X date this agent no longer represents him and T’s will need to deal with/pay him directly? T’s will need to be given notice for access to the property but he can then start to unpick whether the agent has been compliant with the rules and what steps would be needed to get the house back. 
    Thank you for this. The agent and tenant appear to be in cahoots and my dad is getting screwed over.

    Noting only two months remain, would there be anything that can be done at this stage? Reposession is looking more and more likely which is a scenario we want to completely avoid.
  • Hoenir
    Hoenir Posts: 1,137
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    SA789 said:


    Noting only two months remain, would there be anything that can be done at this stage? Reposession is looking more and more likely which is a scenario we want to completely avoid.


    Is the product fixed term coming to an end or the mortgage term. If it's the product term the mortgage should default onto SVR. 

    You need to get in contact with the family friend and terminate the business arrangement immediately. A threat to inform the HMRC may spark a response. 
  • alanyau88
    alanyau88 Posts: 57
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    Your father needs to speak to the agent and also the tenants to sort this matter out.  Change the locks if necessary and provide the keys to the tenants only.  Ask the tenants to move if they are willing?  Pay them to leave?  If they refuse, then ask them nicely that he needs to sell the house and if they don't mind showing potential buyers around?

    Your father is breaking the terms and conditions of the buy to let, if the mortgage lender finds out, he may be placed on some sort of banned list.  The lender may also inform HMRC and they may look into this for any unpaid taxes.  It's bad enough to break the mortgage terms and conditions, but your dad has also fallen into the trap of the rent to rent scheme.  Good luck to him!
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