My partener and I are looking at buying a house. We will not be living in the house but cont...below?

Question

(renting) it to my mum. Do we need a buy to let mortgage or declare anything?

Answer 1

If you are paying cash, no problem.

If you are getting a loan, you must explain that it won't be owner-occupied.  

Answer 2

YOu apply for a mortgage.  You might get a better rate since a family member will be living there instead of a tenant.  Declare all your income and assets and you will be approved. /

Answer 3

You will need the lenders consent to any third party occupation in order to avoid breaching the terms and conditions of the mortgage which would entitle the lender to go for repossession.They have the right to inspect the property but never exercise it formally.In practice it is the repayment of the monthly installments which will determine the nature of your relationship with the lender because if you do it is difficult to see how the lender with come to know of any arrangement with your mother.Stay on the voters register,pay the outgoings and if your mother wants to help you out informally from time to time then just say thank you.If however your aim to deceive your lender by fibbing in any part of the mortgage application form or mortgage acceptance then your lender has the option of calling in the police as this will be fraud .You should also appreciate that there is nothing to prevent your mother from giving you a lump sum by way of gift which is not taxable in your hands and may even have tax advantages for her.

Answer 4

To take a loan under false pretenses is mortgage fraud. I wouldn't go there. And don't let a mortgage loan officer tell you how to get around that either!

However, if you read up on the Federal Tax laws, you can own a second property...and some of the costs may be tax deductible.