Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • Keen_Investor
    • By Keen_Investor 13th Mar 18, 2:26 PM
    • 10Posts
    • 0Thanks
    Keen_Investor
    Can I rent a house to a friend on benefits?
    • #1
    • 13th Mar 18, 2:26 PM
    Can I rent a house to a friend on benefits? 13th Mar 18 at 2:26 PM
    As the title says. I have a friend on Benefits, his housing benefit is paid for.. he's on Personal Independence Payment, I won't go into the details why that's his business.

    He's in no way related to me. I'm considering buying a flat in cash and renting it to him for the going rate. It appeals to me as I've known him for 20 years and trust him. Albeit I would still keep it completely legal with tenancy agreement etc.

    Just wondered if there were any laws/rules preventing this.
Page 1
    • Cornucopia
    • By Cornucopia 13th Mar 18, 2:33 PM
    • 10,106 Posts
    • 10,031 Thanks
    Cornucopia
    • #2
    • 13th Mar 18, 2:33 PM
    • #2
    • 13th Mar 18, 2:33 PM
    Does your lender (if you have one) allow Benefit Claimant tenants?
    I'm a Board Guide on the Phones & TV, Techie Stuff, In My Home,
    The Money Savers Arms and Food Shopping boards. I'm a volunteer to help the boards run smoothly, and I can move and merge threads there. Any views (especially those on the UK TV Licence) are mine and not the official line of moneysavingexpert.com.

    Board guides are not moderators. If you spot an inappropriate or illegal post then please report it to forumteam@moneysavingexpert.com
    • Comms69
    • By Comms69 13th Mar 18, 2:37 PM
    • 2,970 Posts
    • 2,939 Thanks
    Comms69
    • #3
    • 13th Mar 18, 2:37 PM
    • #3
    • 13th Mar 18, 2:37 PM
    As the title says. I have a friend on Benefits, his housing benefit is paid for.. he's on Personal Independence Payment, I won't go into the details why that's his business.

    He's in no way related to me. I'm considering buying a flat in cash and renting it to him for the going rate. It appeals to me as I've known him for 20 years and trust him. Albeit I would still keep it completely legal with tenancy agreement etc.

    Just wondered if there were any laws/rules preventing this.
    Originally posted by Keen_Investor
    Check the lease, otherwise no.
    • Annie35
    • By Annie35 13th Mar 18, 2:38 PM
    • 217 Posts
    • 184 Thanks
    Annie35
    • #4
    • 13th Mar 18, 2:38 PM
    • #4
    • 13th Mar 18, 2:38 PM
    It's just down to lender &/or building insurance requirements. Got those sorted you're away!

    Take the time to browse pims or nla sites, so much info on being a landlord, even if you use an agents help it's good to have your own basic idea too.

    I think someone will say don't lend anything to a pal you can't afford to loose' or some such advice so I'll say it first !!!55357;!!!56833;
    • Margot123
    • By Margot123 13th Mar 18, 2:55 PM
    • 842 Posts
    • 865 Thanks
    Margot123
    • #5
    • 13th Mar 18, 2:55 PM
    • #5
    • 13th Mar 18, 2:55 PM
    Check covenants, leases etc before agreeing, even in principle.

    Also buy a crystal ball to look into the future so you can be assured your friend continues to receive enough income to pay you the going rent and then doesn't fall out with you when they can't pay.

    Old adage 'business and pleasure don't mix' comes to mind. You may want to help your friend but it may sour the relationship in the future............it's your call.
    • need an answer
    • By need an answer 13th Mar 18, 3:23 PM
    • 587 Posts
    • 703 Thanks
    need an answer
    • #6
    • 13th Mar 18, 3:23 PM
    • #6
    • 13th Mar 18, 3:23 PM
    A large part of your problem might be that over time benefits don't keep up with "market rent" so what starts out as an achievable payment four your tenant becomes more difficult to afford as time goes on.

    My guess is that at some point you will be faced with the situation of staying true to your friend or renting the property for the rent of other similar things

    There can be quite a difference

    You also need to consider all the factors that also come with being a LL it may not be as simple as you at first believe.
    in S 32 T 32 F 47
    out S 46 T 33 F 39
    2017 -32
    • bobbymotors
    • By bobbymotors 13th Mar 18, 6:22 PM
    • 637 Posts
    • 899 Thanks
    bobbymotors
    • #7
    • 13th Mar 18, 6:22 PM
    • #7
    • 13th Mar 18, 6:22 PM
    You probably can rent it to him, but it's a bad idea to rent to a friend.
    • G_M
    • By G_M 13th Mar 18, 6:42 PM
    • 44,415 Posts
    • 52,720 Thanks
    G_M
    • #8
    • 13th Mar 18, 6:42 PM
    • #8
    • 13th Mar 18, 6:42 PM
    Check the lease if any.
    Check the terms of the mortgage if any.
    Check any covenants in the Title.
    Check the terms of insurance.

    But beware - letting to a friend, especially one on benefits, can lead to

    * loss of friendship and/or
    * poor business/financial decisions.

    If there were arrears, would you evict your friend?

    Now read:

    * New landlords: advice, information & links
    Last edited by G_M; 13-03-2018 at 9:08 PM.
    • deannatrois
    • By deannatrois 13th Mar 18, 8:16 PM
    • 5,415 Posts
    • 7,593 Thanks
    deannatrois
    • #9
    • 13th Mar 18, 8:16 PM
    • #9
    • 13th Mar 18, 8:16 PM
    If you want a buy to let, you don't have to rent to your friend.

    Is your friend financially stable? Does he/she make good choices when spending money? Will rent come before anything else if a problem occurs (it easily can when on benefits, just as when in work)?

    Do you know what your responsibilities will be as a LL? Does the area you are thinking of buying into require LL registration?

    Could you make more money investing the money you would spend on a property, without the hassle being a LL brings?
    • davidmcn
    • By davidmcn 13th Mar 18, 8:19 PM
    • 7,827 Posts
    • 8,002 Thanks
    davidmcn
    I keep reading this as "friend with benefits", which would at least be more interesting.
    • G_M
    • By G_M 13th Mar 18, 9:09 PM
    • 44,415 Posts
    • 52,720 Thanks
    G_M
    would certainly spice up the forum a bit...
    • victoriavictorious
    • By victoriavictorious 13th Mar 18, 9:17 PM
    • 286 Posts
    • 452 Thanks
    victoriavictorious
    I keep reading this as "friend with benefits", which would at least be more interesting.
    Originally posted by davidmcn
    Oh stop it!
    Now that I've read that, I can't UNread it!
    • PokerPlayer111
    • By PokerPlayer111 13th Mar 18, 9:52 PM
    • 252 Posts
    • 88 Thanks
    PokerPlayer111
    I keep reading this as "friend with benefits"
    Originally posted by davidmcn
    haha im glad someone said it.
    • shortcrust
    • By shortcrust 13th Mar 18, 9:58 PM
    • 1,980 Posts
    • 2,943 Thanks
    shortcrust
    I wouldn’t let a property to a friend. Money owed to friends often comes at the very bottom of the list. It’s difficult to push a friend for payment when they’ve just told you how broke they are and how they’re in the depths of despair etc. I’ve twice written of chunky sums I’ve lent to friends.
    • FBaby
    • By FBaby 14th Mar 18, 7:02 AM
    • 16,720 Posts
    • 41,340 Thanks
    FBaby
    It appeals to me as I've known him for 20 years and trust him.
    ]
    Trust is not enough. Depending on their reason to claim benefits, he could be doing fine one day, and have nothing to pay rent the next. They can be apologetic, sorry, willing to try to sort out the issue, but that won't mean they will be able to pay. It then comes down to them not paying, letting you down, but still have a roof over their head, or finding themselves on the street. When face with that choice, most pick a roof over their head over their friendship, and you end up in the same situation, trying to find a way to pay your mortgage.

    This can happen with any tenant, but it hurts a lot more when you see it that you did your friend a favour in the first place.
    • agatham
    • By agatham 14th Mar 18, 9:35 AM
    • 29 Posts
    • 5 Thanks
    agatham
    I think it won't be possible to let someone stay based on benefits. Even if its possible, what if he doesn't get benefits always. It would be safe for you to ensure that there is constant flow of income for the person to whom you are letting the house. With that you can be assured of the rent every month.
    • Comms69
    • By Comms69 14th Mar 18, 10:47 AM
    • 2,970 Posts
    • 2,939 Thanks
    Comms69
    I think it won't be possible to let someone stay based on benefits. Even if its possible, what if he doesn't get benefits always. It would be safe for you to ensure that there is constant flow of income for the person to whom you are letting the house. With that you can be assured of the rent every month.
    Originally posted by agatham
    What if they lose their job?
    • saajan_12
    • By saajan_12 14th Mar 18, 11:28 AM
    • 1,251 Posts
    • 873 Thanks
    saajan_12
    This might seem like a good solution that fits both of your circumstances right now but things can change quickly.

    * What if friend need to move -> what happens to your investment, as it's expensive to disinvest.

    * What if friend loses benefits / has other expenses so cannot pay? Its much more difficult to get a replacement source of income -> Are you happy not receiving rent? Evicting through courts & bailiffs? Finding new tenant? Even if you agree and legally you're right, it can ruin a friendship if you make friend homeless.

    * What if you fall out and friend stops paying / damages property?

    * What if you need to sell and use the capital? Are you happy evicting?

    * What if you need to increase rents to meet your costs?

    ..
    • LandyAndy
    • By LandyAndy 14th Mar 18, 11:34 AM
    • 24,316 Posts
    • 51,372 Thanks
    LandyAndy
    As the title says. I have a friend on Benefits, his housing benefit is paid for.. he's on Personal Independence Payment, I won't go into the details why that's his business.

    He's in no way related to me. I'm considering buying a flat in cash and renting it to him for the going rate. It appeals to me as I've known him for 20 years and trust him. Albeit I would still keep it completely legal with tenancy agreement etc.

    Just wondered if there were any laws/rules preventing this.
    Originally posted by Keen_Investor
    Does your lender (if you have one) allow Benefit Claimant tenants?
    Originally posted by Cornucopia

    Why don't people read what is written?
    • ReadingTim
    • By ReadingTim 14th Mar 18, 1:28 PM
    • 2,733 Posts
    • 3,909 Thanks
    ReadingTim
    Why don't people read what is written?
    Originally posted by LandyAndy
    Because not everyone has the same interpretation of what a cash buyer means. In point of fact, everyone is a cash buyer - it's just the source of that cash which differs.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

212Posts Today

1,904Users online

Martin's Twitter