Family Let

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    #16
    May I suggest that you read the information contained within http://www.ageuk.org.uk/Documents/EN....pdf?dtrk=true together with specific Fact Sheets as indicated.

    Judging from what is intimated , there is no guarantee that they would get such benefits as a "Returnee" , certainly there will be a means tested benefit and all assets including the ownership of a property overseas plus savings could disbar them from receiving such entitlements and even if they did ultimately get HB payments the amount would be restricted to a one bedroom property assuming that they aren't bringing other returnees back to the UK.

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      #17
      It's not impossible that the family are not entitled to housing benefit. It will depend on lots of criteria being satisfied.

      The family members should contact the Housing Benefit Dept and obtain a 'pre-tenancy determination form' - complete the form fully, disclosing their own property and circumstances around said property. Once the HB have done all the necessary checks they will be able to confirm whether or not the family are entitled.

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        #18
        If applicant has more than £16k savings - including any property anywhere in the world - then no HB. Simple approach would be to run the free benefit calculators on gov.uk.

        Not declaring income or savings will eventually be found out and result in fines and/or criminal record/imprisonment
        I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

        Comment


          #19
          It's not impossible that the family are not entitled to housing benefit. It will depend on lots of criteria being satisfied.
          I've heard that a common condition, in addition to having an AST is to evidence that the property had not been bought for the sole purpose of renting to the family member, ie. ok, if the landlord comes into a property thought inheritance, or are moving away and renting, or have rented to other tenants before, but not if it is bought as an investment to benefit the family members.

          Comment


            #20
            Thanks for all your advice. It looks like we will just have to accept that benefits will not be payable to our Family tenants. However, I still have an issue as a landlord and having to comply with the Rentsmart Wales codes of practice. This conflicts with the requirements imposed by the mortgage provider. I can't set up an AST as stated in the mortgage T&C's, but as a registered landlord I have to offer a tenancy agreement.

            Comment


              #21
              Then you'll have to get a BTL mortgage, and pay the extra for it, as per post #2. How odd that well intentioned government regulation ends up costing people more. (not)

              Comment


                #22
                BTL mortgages do not allow for family letting, other than a few of the very smaller building societies with very high rates and fees. I was advised by my advisor to go for a residential family mortgage.

                Comment


                  #23
                  You make two points that I feel require discussion

                  You query why you have to register the property with Rent Smart Wales, in my opinion you do not have to for the following:-
                  The property has been mortgaged by you as a 2nd Family property,as you have now accepted that there is little scope of obtaining financial benefit of your relatives claim for HB, then their occupation as guests would not require the property to be registered under the scheme, this of course would only become relevant if the family moved out and the property was then Let on conventional Letting arrangements.
                  You make the point that Regulated Buy to Let mortgages are available by a minority of lenders, that may be true but the rates being charged are not disproportionate to the type of funding required, I suspect that your broker may not have a full grasp of what funding facilities are available; as you have said that financially you have no problems in meeting the mortgage costs for both properties I question why you haven't sought a funding method to ensure you are completely compliant as I do wonder what declaration and information was made on your second Familiy mortgage application given that every application asks for confirmation that this is your primary place of Residence.

                  Comment


                    #24
                    Hopefully it is the case that the property does not have to be registered with Rent Smart Wales.

                    I have asked my adviser to look again at regulated BTL's and has not come up with anything suitable. His advice is still to go with the 2nd residential mortgage for our situation. All suitable regulated BTL's had a maximum LTV of 60%. We require 75% and the only one that fully met the criteria had a large fee and a very uncompetitive rate. Anyway I think the loan is too far progressed to change now.

                    It would be nice if there could be some form of legal agreement in place should the family member no longer occupy the property, to ensure that her husband would remain in the property but on a commercial arrangement (obviously by changing to a standard BTL). Also that they would have no interest in the property should we wish to sell. I assume that the mortgage provider will put something in place to ensure that the occupiers will not have an interest in the property if the mortgage goes into default.

                    Comment


                      #25
                      Without sounding hard but there are occasions when what you want you cannot have., in short beggars cannot be choosers. I fear you could be entering into something which could cause you problems in the future.

                      Comment

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