selling and renting your house back

clutton_2

Brit1234 - ""The buy to let industry is being heavily investigated by police lender and the FSA for fraud,"

where is your evidence for that ??

Save4ArainyDay

Let me give you another example from yesterday!

Barratt Homes building a mile from me.

3 bed semi - price £189950

Has been valued by a Surveyor for mortgage purposes at £170,000

2-bed semi - Price 169,950

Valued by Surveyor at £155,000

Now there is a problem! Obviously to sell these houses Barratt will have to reduce the asking price of the 3 bed by £20,000 and the 2 bed by £15,000.

A lot of homes on the market were at Last July's prices i.e. the £400,000 house. Probably is worth about £325,000 if valued by a Surveyor.

The Cash Sales buyers will not pay full price - especially in a buyers market that we have now. They are in buisiness tio make money just like anyone else.

Whislt accusing them of paying just 65% - 70% of property asking price, you should should remember that asking price and market value are 2 entirely different figures!

Market value is what someone WILL PAY, not what an emotionally attached owner or greedy estate agent thinks it is worth.

Save4ArainyDay

tallyhoh wrote: »

How do tenants get on if after selling their home & clearing any outstanding debts they try & claim housing benefit?

Would it appear that they had disposed of their property in order to take advantage of the system?

Should I point out that I am not offering an opinion on this, I ask because I dont know the position.

Thanks

As I understand if the tenants can show evidence of their inability to continue as owners i.e. take along repossession letters etc to their Housing Benefit department they can prove their need to the benefit.

If they have sold up and rented back and now have £1000's in the bank they will not be entitled to HB.

Hope this helps

ree1971

i have come to the end now off all my knowledge and brain they r really fried dont know where to turn but a SELL AND RENT BACK COMPANY ANY ADVICE WILL BE WELCOME MY HOUSE is worth about 10000 how much is a good offer from theese companies and who should i go with PLEASE PLEASE PLEASE HEL[P

Scubabe

I heard back from the company who bought our house today and they don't buy houses in your area.

Honestly though I gave you sound advice in the other thread have you followed it?

ree1971

yes thnx scubabe i have phoned about 6 up 2 now they range between 70,000 and 85000 all are slaging others of sayning dont go with them go with us very frustrating need to get a grip now im going to get an independent valuation done then i will make my mind up no other way out have not got time to sell private as repossession will take place about 3 wks from now jst waiting for the date.

ree1971

Save4ArainyDay wrote: »

Brit1234 - you are obviously so well informed - NOT!

Just a few weeks ago I met a lady with 2 children who was due to be repossessed on Tuesday 18 March. I could not finance the purchase of her house myself as the valuation by the bank came in at £20,000 less than the estate agent had lead her to believe the place was worth. The exercise of viewing the property (over 100 miles each way), paying for searches and valuation cost me over £500.
However the poor lady could find nobody to buy the property and she and her children were on their way to a B&B or a hostel as the LA had no property available for them.

After advertising and phoning everyone in the business I know I finally found her a buyer. The completion was less than a week before repossession was due. The lady now rents the property at a pre-arranged rent and the buyer has assured her that as long as the rent is paid then she can continue to live there as long as she wants. It is not the buyer's fault if the term of an AST is 6 months - that is the way it is. No landlady/landlord is interested in losing a paying tenant - especially one who has provided all their own furniture etc.

Please don't tar everyone in the Sell and Rentback business with the same brush - yes doubtless there are a few rogues around but they are FEW in my experience. Just like there are rogue priests, teachers, councillors, MPs, doctors, solicitors etc.

Now to answer the original query

Sell and Rentback works like this

Buyer gets 85% mortgage (based on ACTUAL value given by Surveyor)
Buyer has to make sure that the rent x 1.25 per month is equal to or more than the rent.

If mortgage is £500 then rent has to be £500 x 1.25 = £600

Current buy to let interest is 6.09%

So £100000 purchase price means a mortgage interest only of £6090 per year

£6090 x 1.25 = £7612.50 (rent per year required)

divide by 12 = £634.38 pcm rent

The sell and rentback buyer also pays all the solicitors fees etc. so there is NO COST to the seller whatsoever.

If the seller wants to pay less rent then they have to take less money from the sale - simple economics

If you are being repossessed Sale and Rentback is one of the only options available to most people.

How many empty Council or Housing Association proerties are there in your area??

In the example I gave of the lady with 2 children - her outgoings (which she could not fund any longer) were reduced by about £300 per month. She can now live within her means.


If anyone needs any further information please do not hesitate to contact me. If anyone is considering selling I will tell you what price you should expect to get from a reputable Property Investor.

I hope this serves to educate those that until now have held an unreasonable view of these schemes.

hi i would like too know how much i should expect for my house on the sell and rent back thnx:eek:

Save4ArainyDay

Ree1971

I have sent you a PM