Buying our first house together - Third person as a lodger? Thoughts appreciated!

Bromhead

Bromhead

Bromhead

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11 Nov 2012
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Staffordshire
Hi guys,

Wanted your thoughts on this. Me and my partner are going to be putting in offers for houses in our area very soon and hopefully within 4 months we expect to be moving in to said house. We already have a mortgage promise, a good chunk of money saved for the deposit and we earn enough to comfortably pay the mortgage every month, bills etc.

The mortgage itself will be around the £750 mark (obviously we don't know exactly what it will be until we find the specific house and know the price we're going to be offering).

We're just out of university and we have a lot of friends who are either renting, or still stuck at home and want to get away. The house we will be buying will either be a 3 or 4 bedroom semi-detached or detached.

Our initial thoughts are to rent out one of the rooms, with access to all other rooms of course, for a set amount so that it isn't too complicated. We were thinking of asking for £300 which would be set in stone and all bills covered.

This would massively reduce our commitment in terms of outgoings per month. I understand a lot of members on these forums will have owned a house for many many years. However with both of us fresh out of university, we're use to sharing houses, halls and to have a friend around lodging in your house may not sound ideal, but to us it really is the norm.

TL;DR

1. Do you think having a lodger is a good idea and if you were in the same position, would you?
2. In regards to the price, again do you think it is a fair price when considering all bills are also included.
3. Anything else you think might be important :p
 
I did exactly this with my best mate.

1: yes i did it
2: we split everything 3 ways
3: you need to tell your mortgage company some will not like it! Ours made my friend sign a form saying he had no rights to the property etc.
 
1. I'd do it if I could afford my own place, a friend has offered me to stay at theirs who are doing the same thing.
2. £300 depending on the size of the room/shared areas is quite fair, very good with it including all bills.
3. You'll need to be careful with building/contents insurance, also try to get a proper contract written to cover all sides if there are any issues.
 
Thanks for the responses so far. General consensus appears to be this isn't an alien thing which is good! Out of our friends we're the first to make the plunge and purchase a house, so in terms of renting rooms once you own a house, this is new to us and we have no friends who have done similar to base it off.

All new territory, but extremely exciting. Currently I'm living back with my family, which although it has been enjoyable, there is no internet here. I tether with my phone which has been horrible :p No online gaming!

One point that has been raised and that I was worried/concerned about slightly is the legal aspect. I guess I would need to ask my mortgage lender the legal side of things in order to protect ourselves against any sort of claim/right to the house if they lived there for x amount of years?
 
Rental agreement
Rent book
Sign it up each month

Not sure what the amount is, but the rent a room scheme allows this to a lmit after which you get taxed on the income, unsure of the limit
 
We're renting our spare room out currently to a friend who's only here for a week every 6 weeks. Works out well :p.

We have to pay our mortgage company a one off £500 fee to allow us to rent.
 
Surely it would only affect the mortgage company if the money paid by a lodger was taken into account when applying for a mortgage in the first place?

Just rent them the room, all inclusive so their name isn't on any bills etc

I thought about doing this as well and i certainly wouldn't go asking my mortgage company what i can and can't do in my own house, or pay them for the pleasure of it!
 
Teknobry said:
I thought about doing this as well and i certainly wouldn't go asking my mortgage company what i can and can't do in my own house, or pay them for the pleasure of it!
Click to expand...

And risk voiding both your mortgage and your house insurance? For the small fee some charge what is the point taking that risk?
 
How exactly is your mortgage company suddenly incurring an extra cost because you're renting your spare room to a friend?
You borrow a set amount off them and pay it back at an agreed rate, how does that suddenly change?
If you have a child do you then have to notify your mortgage company, do you have to pay them for the privilage of having kids?

If a relative comes to stay for 2 weeks, do you run to your mortgage company waving money at them to get their permission?
 
It changes because you agree to it when you sign your contract. It's that simple.

Renting a room to someone is not "having a relative coming to stay for 2 weeks", and passing it off as such is fraud whether you like it or not. It's money for old rope for the insurance/mortgage companies but thats how it is.
 
Why though? I could understand somewhat if you got a mortgage based on having a lodger but it doesn't make the slightest bit of difference to them what you do with your house once the loan & repayments are sorted.
Just another way for them to get more money out of you for nothing.
No way of them finding out, so don't tell them.
 
Well this is my first post in years.. but thought i'd chip in.

I currently rent a room out in my house.

£300 a month is a really good price...
it maybe worth looking at this link

To protect your self and the lodger and to know where you both stand you will need a contact... its different to sharing a house at uni cause at the end of the day it will be your house and you need to protect your investment.

You'll have to make sure your building and contents insurance allows you to have a lodger in the house... if it doesn't it will not be valid!

You'll have to inform the council if you have a lodger as they might need to change their prices.

What I've done with my lodger is I've split all of the bills in half... this includes

CT
Gas and Electric
TV License
Water
Virgin Media (inc TV, BB)
Mortgage
House insurance

Think that's it off the top of my head.
 
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