Soldato
Does this actually work/is it legal?
Legal NO , done often yes
Does this actually work/is it legal?
lots of people don't aim to make a profit from the rent, so long as the rent covers all the bills, that is perfectly fine. although it is obviously better to aim to make a profit so it's a win win situation, but that usually requires a much larger deposit.
also it doesn't matter if he loses a little bit of money here and there, it's a long term investment, he will reap it all back a hundred times over in the long run.
to the OP, may be better to make it an interest only mortgage, that way you make a profit every month, which you can put into a separate bank account.
i'll give you an example on one of our properties:
loan outstanding £40K (flat was bought 2 decades ago was roughly £50K at the time, it's now worth £150K+, in glasgow city centre), interest only mortgage is only £89 per month, the rent is £500 a month.
it doesn't matter if the mortgage never get's paid off, we make a profit every month and the flat has tripled in value since we have had it.
the trick is if your a first time buyer, do not tell the bank you are letting it out, get it on a private mortgage, interest only.
Illegal to get a private mortgage knowing your going to rent it out. But its not illegal If bought it to live in but your circumstances changed and you "forgot" to tell your mortgage provider that your then renting it out.
One is Fraudulant
One is breach of contract
And if the lender finds out you didn't tell them they can pull the mortgage and ask you to pay all the mortgage back. Oh and plus if you don't tell your lender it invalidates any insurance you have so if your house burns down your stuffed
Legal NO , done often yes
It's quite a sought after little town due to the railway station and it's proximity to the motorways. Location location location! Other 1 beds in the same complex are up for around £425-£475? This would be at the higher end of that.
Always better to buy, renting is just burning money
Always better to buy, renting is just burning money
I wouldn't want to be a landlord personally as there is a lot of responsibility involved
Codswallop - take me for example, the interest on my savings pay my rent and the actual principle itself is growing with respect to the asset I intend to buy with savings (ie house prices are stagnant/falling). Buying for me in this scenario would be stupid.
go via a (good) agent I pay 10% + vat fro a fully managed service they sort everything.....
All I'm basing it on is this,
1. For me to rent a 3 bedroom place would cost over/around £500 per month,
2. For me to get a mortgage on a 3 bedroom place is costing me £315 per month.
1. After 20 years, I will still be the exact same position
2. After 20 years I will own the house