Buying property with DSS tenant – steps to safeguard myself?Make Text Bigger
I am in the process of buying a 3 bed house where the tenant has been in 4.5 years and wants to stay. She is 37, 2 children (one boy one girl in local primary school), one dog, divorced, from the area and wanting to stay near family, and until recently has worked in a low skill job part time.
Now on ESA, plus assorted other benefits, and likely to be off work a while with bad back she says. She currently contributes £50/mth on top of 485 housing benefit at present.
However market rent is much higher than she is currently paying – she may get some extra HB towards that. Even giving a lowish rent for a reliable long term tenant her rent would have to go up another 65-70 quid to be worth my while. She knows this and says that she’d pay, as if not she will have to pay the same or more elsewhere AND have hassle of moving from her home. Excellent refs from vendor who would prefer her to stay, and it is evident from the house that it is well looked after if a bit tired.
Although logic says that given current political and benefits situation and her changed circumstances, this is a big risk, gut feeling is that it will be ok because she will make it ok. The prospect of a long term stable tenant appeals – many years ago I had fully referenced, working, nightmare tenants! Her ex-husband was guarantor to date which she told me about when we met, but today I learned she is approaching her parents instead. Her contract runs till October, but she and vendor are agreeing some compensation between them to terminate earlier. The agent who originally set tenancy up say switching tenancy and deposit should be no problem.
Questions now are what do I need to do to protect myself just in case? Browsing this excellent forum tells me:
– make sure guarantor is home owner and preferably working (I suspect parents may be retired)
– make sure guarantor can pass RGI screening, and is responsible for whole rent not just top up
-get her to agree I can speak w HB office
Anything else I need to add to my checklist?
Can someone explain exactly what I need to have in place re the tenancy end/restart? Also anything specific I should put in new agreement to cover myself?
I won’t have a mortgage so no lenders to consider – just my and my father’s savings and sanity!
Many thanks for advice
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