Letting to current owners

glothy

I have another post about my purchase problems but this is another solution I'm considering.

My mortgage terms require same day exchange and completion. The sellers won't do this. I'm considering allowing the current owners to live there temporarily under a non assured tenancy until they've completed on their onward purchase. Does anyone have any experience of or advice on this?

glothy

This has been asked a few times in the past but I can't see a resolution. 

I'm in a let to buy situation and the sellers simply won't/can't do same day exchange and completion. This is a requirement of all let to buy mortgages as far as I can tell. I've even asked the lender if they will change my existing mortgage to buy to let if I move to a rental property and they've refused.

Does anyone know of a lender that would switch my current residential mortgage to a buy to let on the basis of me moving to alternative rental accomodation? 

I've explored many options but no one seems to be able to help. It seems really odd that the only way to switch to buy to let is by buying another property.

Olinda99

they would have to move out (inc posessions, furniture etc) on completion day and stay in a hotel overnight or wherever thus giving you vacant posession.

next day you can sign an AST with whoever you want but note the tenancy can only be ended by the tenants or a court ie they can stay longer than you may want

also you have to get required gas safely, electrical safety, deposit protection, amendment to house insurance etc and maybe a licence from LA if they require one. 

not sure what you mean by using a non assured tenancy. these tend to be for example for holiday that's where the main home is elsewhere but it sounds as though this will be their main home so you should be careful as you may well be creating an AST even though you don't think you are

user1977

And none of it will be possible if you're buying with a residential mortgage.

elsien

Do a search.

There are a lot of threads on here explaining why generally speaking it is not a very good idea. 

glothy

elsien said:

Do a search.

There are a lot of threads on here explaining why generally speaking it is not a very good idea. 

Nothing is coming up in search. I've seen one where everyone said it was a terrible idea, and one where the buyers were allowing them stay with extortionate rent 🤷‍♂️

silvercar

It would be against the terms of your new mortgage, unless you are getting a BTL mortgage.

why does your mortgage require you to exchange and complete on the same day?

silvercar

Lenders usually require those getting a BTL mortgage to also be homeowners. Often because it could be seen as a way to exceed your borrowing based on income of you got the mortgage based on potential rental income instead.

glothy

Olinda99 said:

they would have to move out (inc posessions, furniture etc) on completion day and stay in a hotel overnight or wherever thus giving you vacant posession.

next day you can sign an AST with whoever you want but note the tenancy can only be ended by the tenants or a court ie they can stay longer than you may want

also you have to get required gas safely, electrical safety, deposit protection, amendment to house insurance etc and maybe a licence from LA if they require one. 

not sure what you mean by using a non assured tenancy. these tend to be for example for holiday that's where the main home is elsewhere but it sounds as though this will be their main home so you should be careful as you may well be creating an AST even though you don't think you are

Non assured is very different to AST. None of the AST rights apply. AST can't be applied if a tenancy doesn't meet the minimum or maximum rent threshold. In those circumstances a non AST could be used. 

glothy

silvercar said:

It would be against the terms of your new mortgage, unless you are getting a BTL mortgage.

why does your mortgage require you to exchange and complete on the same day?

Because it's let to buy and those are the conditions of the mortgage. This applies to all let to buys according to my mortgage advisor and google. No exceptions according to my solicitor.

glothy

silvercar said:

Lenders usually require those getting a BTL mortgage to also be homeowners. Often because it could be seen as a way to exceed your borrowing based on income of you got the mortgage based on potential rental income instead.

Thanks. There are a few people saying they managed to do it but I wonder if rules have changed recently as it doesn't seem to be a possibility now.