Living back with my mother…

by Readers Question

15:27 PM, 29th September 2014
About 4 years ago

Living back with my mother…

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Living back with my mother…

I’m thinking of entertaining the idea of getting my first BTL. Living back with my mother...

I’m mortgage free at my present home so by moving in with mother and renting my property this would give me a small income of around £450 / £475 a month.

I want to get a 3 bedroom property and rent 2 of rooms out to different people, and return back to my Moms to acquire a good cash flow situation and make over payments to the BTL by combing the rents from the 2 rooms, my income, and the rent from my mortgage free home totalling monthly payments around £3k.

Question is; if living for a long period with my mother doesn’t work out, can I move into the 3rd bedroom at any point?

Please advise…

Thanks

Mark Doxford



Comments

Mark Alexander

15:31 PM, 29th September 2014
About 4 years ago

Hi Mark

If you are planning to retain a room in the three bed house then what's the point of living with Mom?

As a live in landlord you have far more rights and the first £4,250 of rental income would be tax free under the "Rent A Room" scheme too. There's nothing to say how much time you have to spend at home and there are no limits on how long you can stay at your Mom's either. All you need to do is prove that you live at the address, e.g. all post goes there, driving licence there, on the voters roll there etc.

Get my point? 😉
.

John Constant

16:42 PM, 29th September 2014
About 4 years ago

I'm assuming that your current property would not be suitable to rent spare rooms out, as well as living there yourself( ie, it could be a 1 bedroom flat, for example). If this is not the case, then the scenario outlined by Mark, above, would be applicable.

If you wanted to live in the BTL property, in a spare bedroom, this would not be possible unless there is a regulated BTL mortgage in place. These regulated BTL mortgages are few and far between now, so you will need to take specialist advice. Please take a look at my profile, and contact Mark at property118, who will give you my details, if you need further assistance.

Mark Alexander

17:07 PM, 29th September 2014
About 4 years ago

Reply to the comment left by "John Constant" at "29/09/2014 - 16:42":

Hi John

My thinking was that the new 3 bed property would be purchased as a PPR with a residential mortgage. So far as I'm aware, lenders will not have a problem with an owner occupier taking in lodgers will they?
.

John Constant

17:34 PM, 29th September 2014
About 4 years ago

Reply to the comment left by "Mark Alexander" at "29/09/2014 - 17:07":

Mark, I was working on the basis of BTL mortgage because of the intention to move back in with mum and not to live in the property.
If he lived in the property from the off, on a residential mortgage and tenants in place, I would think that the lender would need to know about that. The situation is the same if a sole purchaser wishes to buy and have their partner live with them. The lender would need to know about that scenario for affordability purposes.

Mark Alexander

17:50 PM, 29th September 2014
About 4 years ago

Reply to the comment left by "John Constant" at "29/09/2014 - 17:34":

Hi John

Yes I see where you were coming from now.

Given that Mark D had mentioned paying £3k pcm into the mortgage I doubt affordability would crop up as an issue but we don't know that for sure. I suspect that on day one the details of the lodgers would be unknown, hence affordability would have to be considered on Mark D's income alone of the resi mortgage on a PPR route is the preferred option.
.

Rob Crawford

12:05 PM, 30th September 2014
About 4 years ago

Hi Mark (Doxford), I would look at this in a totally different way. You have paid off your mortgage so why not remortgage it and buy two additional properties on an interest only mortgage and let them? Obviously I don't have any figures to work with but it may be worth you doing some sums to see if its viable - welcome to the property investment world!

Mark Dotford

18:45 PM, 2nd October 2014
About 4 years ago

Reply to the comment left by "Mark Alexander" at "29/09/2014 - 15:31":

Thank you Mark for your feed back reading between the lines I know where you are coming from.

Mark Dotford

18:50 PM, 2nd October 2014
About 4 years ago

Reply to the comment left by "Rob Crawford" at "30/09/2014 - 12:05":

Hi Rob Thank you for coming back with a valid suggestion. 1 bed Flat resale about 125k. Rental in come £450.

Mark Dotford

18:55 PM, 2nd October 2014
About 4 years ago

Reply to the comment left by "John Constant" at "29/09/2014 - 16:42":

Hi John thank you for your feed back, you guessed right it's a 1 bed flat. My thoughts are to go down the line of my next purchase to be a PPR and rent out the rooms whilst technically living with them but spending a lot of time at my moms...

Mark Dotford

19:18 PM, 2nd October 2014
About 4 years ago

Reply to the comment left by "Mark Doxford" at "02/10/2014 - 18:50":

Thank you for the warm welcome to the property world, can I make over payments to a interest only mortgage. ?

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