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Can I rent my Buy-to-Let property to a family member?

Family
It can be done but it is a little trickier than a regular Buy-to-Let.

When renting to a direct relative (i.e. parent, child, grandparent or sibling), this becomes a “regulated” Buy-to-Let.
Many regular Buy-to-Let mortgage lenders don’t offer this specialised product so it’s about finding those specialist lenders and getting a good product fit for your needs.

This can however mean that your choice of lender is quite limited, which can result in a higher rate of interest being charged in comparison to a regular Buy-to-Let mortgage.

If you’ve already got a regular Buy-to-Let mortgage and you’ve been renting the property out to a tenant that’s not related, but now wish to rent to a direct relative, you should let the lender know about this change. 

What happens if you have a Regulated Buy-to-Let mortgage and your family member moves out and you get a regular tenant? Well, officially you should let the lender know, this is information they would be interested in.  When you come to remortgaging the property, you will be asked if the property is going to be let to a direct relative. In this instance, you could see more products available to you as you will be able to apply for a standard Buy-to-Let mortgage.

Buy-to-Let properties can be a good investment and renting to a direct relative can resolve accommodation issues. For example, if you have a child that is going to university, buying a property for them to live in whilst renting the remaining rooms to other students can help relieve the financial burden of accommodation costs and even help towards fees. An elderly parent may need a property that isn’t generally available to rent and by purchasing a home tailored to their needs and renting to them, this can give you peace of mind.

Please note the content of this blog is for guidance purposes only and does not constitute for professional advice. Contact us today at info@wolseymortgage.co.uk or by calling 01473 216950.
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Monday, 18 November 2019

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