Mortgage is a kind of loan that uses the property as security for the loan. Only those people who are eligible for it are able to avail of it. Based on variables like duration of repayment, repayment amount etc., a suitable decision regarding mortgage is arrived at. Mortgage calculator is instrumental in bearing the cost of mortgage.

Mortgage calculatoris also very useful in calculating the loan interest. One can easily decide the rate of interest being charged as well as its financial implications. Mortgage calculatoris also very useful in discovering the market value of your house, in case you are being transferred. It helps one evaluate the market value of the property being purchased.

Once a decision has been made regarding the purchase value of the property, affordability is also related to the mortgage. Mortgage calculator helps in making a calculation as to whether one is capable of paying the mortgage amount.

The financial calculator will help one evaluate the monthly repayment amounts. There are different cases too, i.e. enter percent of loan amount, or annual percentage rate etc., are some factors to be taken into account. Once calculated, one can arrive at the break-even point. The break-even point is the monthly income deducted from the mortgage amount.

Additionally, one can find out whether there is any loan or penalty for early repayment of the mortgaged amount. The interest to be calculated can be considered as one time or twice delayed.

In case of the scheduled rate, the mortgage payments will remain about the same for the life of the loan, whereas as stated earlier it will be an increase in case of penalties. If there is any change in the interest rate, it will also change the break-even point.

In case of fixed interest rates, one might pay extra payments if mortgage installments are not settled when the said clause comes into effect. Generally in general there are three main break-even points:

Early Repayment penalties

Riskier Mortgages

Early Repayment penaltyAs the initial interest rates remain the same in the beginning, payment will continue on the life of the loan until the break-even point. Repayment penalties can reduce the financial burden at the time of early repayment.

The riskiest mortgages are of two types:bad credit mortgages and non standard mortgages. These are high risk mortgages for the borrowers for reasons such as adverse credit, mortgage conveyancing, poor credit record etc.

There are plenty of tools available via which you can decide what type of mortgage would be right for you. Mortgage dealers can also help you out to find out the suitable option. As for the early repayment penalties, it is generally the early repayment penalties that are the biggest hold up in the mortgage repayment.

It is important to ensure that the money you need to localize to repay the mortgage is available for you to accommodate the penalties if re-mortgaging arises.

Summary:

• Income: Monthly repayments £345.14:- Monthly payment expressed as a percentage of the loan sum borrower’s income.
• Savings in the bank: Monthly deposit required to access the savings.
• Cash Flow Monthly: Money transferred through the mortgage account ( Stan til consult).
• Mortgage repayments: The monthly payments
• Monthly interest: Early Repayment Penalties
• Early savings: Money put into the account.
• Cash Flow monthly: Money received from the mortgage account ( imbalance).
• behavedeway: Sealing credit to acts as a mortgage deposit.
• NMI: Receives net funds transferred in.
• Early repayment penalties: The penalties incurred during early repayment.
• Risk: Substantial increase in the rate of interest afforded, that stretches the repayment amount and beyond the value of money at stake.
• Early Repayment Penalties: Penalties incurred during early repayment if the loan is repaid early.
• You can examine whether it is important to apply for the mortgage:
• Eligibility: Do you even qualify to apply for the mortgage?
• Credit rating check: As a client you need to submit necessary documents such as payslip, bank statements etc. to support your income and expenditure. The higher your score, the more eligible you are.
• Affordability: Your down payment will be high and closing expenditure at least 15% of your monthly pay. If your monthly housing and council tax bills are high, then you might not be able to afford a large mortgage.

Applying for a mortgage can be challenging that’s why you need to seek out professional advice from an experienced Mortgage adviser who can advise based on your current circumstances.

The post What Is A Mortgage Repayment Calculator? first appeared on Ready Steady Sell.

source https://www.readysteadysell.co.uk/what-is-a-mortgage-repayment-calculator/

Are you considering investing some of your own money into a HMO property? Before you do that, do you actually know the pros and cons of investing in these properties? If not, don’t fear. This article will instruct you on all the pros and cons plus everything essential you need some knowledge of when it comes to HMO properties.

Firstly, what are the pros of HMO properties?

1. Arrears will not impact your cash flow as much using HMO properties.
2. An addition to tenant demand depending on the area you pick
3. More income from fewer properties
4. HMO properties offer a higher yield
5. Less damage taken from “void periods”

These are the positives in additional detail

1. Arrears will not impact your cash flow as much using HMO properties

Is your single tenant buy to let investment property in arrears? You will likely be impacted instantly by the lack of cash flow.

On the other hand, if one of your six tenants in the example above were having some financial difficulties and thus couldn’t pay their monthly rent, assuming that the other 5 tenants dont have somewhat similar problems financially, you still do have 5 clients that are keeping your cash flow ggoing

E.g. by using the same numbers of tenants above, if the single family of your property refrains paying rent, you receive nothing from them per month. However, if one of the 6 HMO property tenants stops paying, your rent would still be near enough as high (specifically 1/6 of what you were getting with all 6 tenants paying their rent.)

2. An addition to tenant demand depending on the area you pick.

If you choose the right area to buy your HMO property, you are a lot more likely to get decent demand from people who are looking to get cheap rent. It is a lot cheaper for your tenants to pay for a room in a house vs being made to pay rent for a whole house or even a flat.

Your HMO, however, does need to be in a town or city, as the best demand is located here, meaning you can have your property at max potential and thus the maximum amount of income. There is absolutely no point in purchasing a property in the middle of no where and expect it to be booming with demand.

Moreover, towns and cities with good universities and colleges are an amazing place to invest in HMO properties. The reason? Students. Students love HMO property concepts, not only because it is cheap, though that is one of the more important reasons, but also because they don’t really want to live alone. Students going to university are likely starting again with little to no friends and HMOs help them to find just that. However, tread with caution over students in your HMO, as they have a reputation for obliterating, smashing, and destroying properties.

3. More income from fewer properties

If you have a preference for the ideal of having fewer investment properties, HMO properties are your best friend. If you require a good cash flow with three to four HMO properties, this may be much better than having 8 to 10 buy to let properties to create around the same cash flow.

4. HMO properties offer a higher Yield

Because of the fact that there is now more tenants in a HMO property over a buy to let property, a HMO makes much better do with the acquired space from the rent. This is likely why the income is a lot higher and why the yield is much greater than on a standard buy to let property, or something a long the same lines.

Take this for example, even within a much smaller HMO property which makes much better use of a 4 bed property, and thus it produces much better rental cash income. If this 4-bed house were to have two reception rooms, one of these rooms can also be used as a bedroom.

That of course means you can have a further 5 tenants in this house instead of just one single family. On the other hand, the number of tenants in your property also depends upon room sizes within the property and generally how much communal and living space their is within the property. However, if we just assume for now that the room sizes all comply with what the tenants want, let us further explore this example.

For the purpose of the example, let’s agree the standard rent for a single family for a property of this general size and average location would overall cost a rent of about £1000 per month. But for the same house and location, each room in HMO properties let for £400 (for each individual room).

This therefore allows your HMO gross monthly income from rent £2000 rather than £1000, which is obviously double what you were originally getting, which is an amazing deal. On the other hand though, with HMO properties you are responsible for paying for all utilities, as the rent includes payment for this. This increases running costs for you, but not by much each month; you will still be making a much higher income. Another point to note is the management fees within a HMO property will be much higher than they are within a buy to let property.

However, even with these additional costs going to all these different things to run the property, your personal monthly cash flow will be a lot higher than it would be if you were to rent out the house as a buy to let. Thus giving you the better yield.

5. Less damage taken from void periods

By continuing with the example from the point above to help show this point in action; if you were to rent the same property to a single family let you have one tenant. If this tenant were to give notice of moving property for any reason, you will likely have a void when this tenant moves out until you get a new tenant.

However, if one of your many tenants were to give notice, you would still have many tenants living within the property and also likely a new tenant moving into the property. The only time this can mess up is if all of your tenants leave at the same time, which is never going to happen. Even if in the miracle chance it did, you would still likely have a high demand, and therefore tenants moving in.

What are the cons to HMO property investments?

1. More difficult to get finance.
2. More planning restrictions.
3. Not all properties suit HMO
4. Limited market when selling HMOs
5. Increased starting up costs
6. Higher costs
7. Property management becomes harder
8. You need to consider tenants mixing
9. Higher deposits
10. Increased legalisation
11. HMO licence is required

1. More difficult getting finance

It can be a lot harder to obtain a HMO property mortgage, even more so if you’ve never owned a property in the past. It is far easier to get a specialist HMO mortgage if you are already somewhat experienced in the field of being a landlord and own at least one property, however the more you have, the more likely you will get the mortgage, buy to let properties prior to this.

Lenders want to trust in you that you have the adequate experience as a landlord in order that you are able to pay them back the loan as time progresses.

2. More planning restrictions put in place

It isn’t all properties that have changes made in order to flip them into being a house of multiple tenants. There are quite a few planning permissions needed to be granted in order to set up your HMO, that without can lead to lawsuits and jail time.

The most important planning permission you need is the Article 4 Direction. This planning permission was returned in 1995, and since then, many town councils have brought on the rules of this article. Essentially, the article means you are allowed to convert a property into an actual HMO .

You must tread with caution over this; if you buy a property that’s in an article 4 area (that doesn’t have prior planning permission before you bought it) there is no guarantee you’ll be allowed to make your property into a HMO. Of course you would still be able to sell it, or list it as buy to let, however you may have already invested in such a way that you can only gain money from it being used as a HMO.

3. Not all properties suit HMO.

Your property is required to be a certain size, and must be suitable for whatever number of occupants you can manage within your property. This of course alludes to bedrooms being over a certain size for each individual, and the communal area being a suitable size for everyone at once.

Furthermore, you need to have a designated number of toilets/bathrooms per each individual. Plus the kitchen must be suitably sized, and also requires the right facilities for the number of tenants you have.

4. Limited market when selling HMOs

It is crucial that you realise that your target market is quite limited when selling a HMO. You are only able to sell your HMO property to a separate investor, unless you have the courage to evict all your tenants and make all necessary changes to sell the property as a house, but by then you would be rubbing pennies together. You wont receive any rent, as all your tenants are evicted and thus you cannot gain an income from the property, and must rely on your own money.

5. HMOs require start up costs

HMO properties can be quite expensive, as you need to furnish each and every room, plus the communal areas. You need to pay for plumbing for new bathroom installations, or new kitchen equipment etc. Whilst on the other hand, in buy to let properties, you can sell the property with little to no furniture.

HMOs also require certain expensive equipment such as fire regulations and environmental health regulations. Overall it can get quite pricey.

6. Higher overall costs

The overall running cost coming from a HMO property are, a lot of the time, much higher than a buy to let property would be. You, as the landlord, are required to pay for electricity, heating, water, gas etc. But there can also be a higher wear and tear cost within HMO properties too.

Additionally, the letting fees on a house of multiple tenants tends to be generally larger than within a buy to let property.

7. Property management becomes a lot harder

Because there are more tenants per property, managing it all can become difficult and exhausting. It can be recommended however that you hire someone to manage it for you, such as a management agent who is very experienced with properties with multiple tenants. However, their wage can be a strain if they ask for too much.

8. You need to take into account tenants mixing.

Because you have a property filled with multiple tenants, mixing people together who don’t know each other all to well can cause a stir, turmoil, anger and arguments etc. You must be very careful with who you choose to be your tenants. For example, an elderly couple would not want to be close to the partying, loud students.

9. Higher deposits are required.

With some HMO mortgage lenders, they ask for a higher deposit. However, if you are looking at a much larger HMO property (within an excess of 9 bedrooms), it is considered a commercial property. Many of the lenders, from this, will not just need the higher deposit, but the mortgage itself will become a repayment mortgage, over the regular interest only mortgage.

10. Additional legislation and compliance with HMO properties.

Because HMO properties involve multiple tenant occupations, it is in fact deemed higher risk. The legislation and red tape is set to help fight for the other tenants in the house from risk of a fire.

Moreover, this means that HMO properties are required to upgrade to accommodate multiple tenants.

In addition to that, it is also very vital that the tenants have a great, liveable environment within the property too. The legislation required landlords to not stuff far too many tenants into an unsuitable property in order to gain the maximum amount of income. There are significant penalties and fines for anyone who fails to comply to this legislation.

11. HMO licences are required.

Due to the increased compliance and legislation within HMO properties, it has recently been revealed that all HMO landlords are required as of now to own a HMO licence, in order to run their HMO property, or even just to own it.

Therefore, this means the HMO landlord must be in a good state and the correct person for the job. They are not allowed any criminal record or against any landlord codes of conduct or laws. The house is required to be adequate for the number of tenants.

In conclusion, the bias of this article appears to be swayed towards the disadvantages of HMO investing, however, just because there are more cons than pros doesn’t mean you shouldn’t go for it.

If you are in need of higher yielding properties, there is not an argument that should put you off investing in a HMO property.

On the other hand, if it is your first time investing into property, perhaps start with something other than a HMO. A great way to start would be buy to let property investments first.

Thanks for reading.

The post What are HMO property Pros and Cons? first appeared on Ready Steady Sell.

source https://www.readysteadysell.co.uk/what-are-hmo-property-pros-and-cons/

When it comes to the time of your life where you want to sell your house, whether that’s being the first, 5th or 100th time, the price you sell it at can be the leading factor on if your house will sell. If you pick a price that other people wouldn’t go for with your property, you could be facing nuclear winter of waiting for viewings and could possibly end up not actually selling at all. However, thanks to the glorious house selling website known as Rightmove, you don’t have to worry about a thing, as Rightmove guides you through everything, and helps you to sell your house at the best price possible for you.

So why are the Rightmove Price Bands much better, and so important in selling your property?

Rightmove’s Price Brands are important as they allow your to see when you set your listing price that you make sure to have the price that is true to your property and maximise chances of a sale. The way that Rightmove organises it is, for example: £150,000 – £200,000 or £200,000 to £250,000. If your house was priced at £200,000, your house would appear in both categories and you would have a much bigger audience viewing your house online.

So, how exactly are Rightmove’s Price band organised, and how do they increment?

• No minimum to £50,000.
• £50,000 to £120,000: £10,000 increments.
• £120,000 to £125,000: One £5,000 increment.
• £125,000 to 170,000: £10,000 increments.
• £170,000 to £175,000: One £5,000 increment.
• £175,000 to £300,000: £10,000 increments.
• £300,000 to £500,000: £25,000 increments:
• £500,000 to £700,000: £50,000 increments.
• £700,000 to £1,000,000: £100,000 increments.
• £1,000,000 to £2,000,000: £250,000 increments.
• £2,0000,000 to £3,000,000: £500,000 increments.
• £3,000,000 to £5,000,000: £1,000,000 increments.
• £5,000,000 to £10,000,000: £2,500,000 increments.
• £10,000,000 to £20,000,000: £5,000,000 increments.

How to price your house on Rightmove into the price bands:

As previously answered above, the best price for your house is between two categories. Your best chance of getting a sale is by placing your property at the top band of what tier you think your property would be in, and therefore you are automatically put in the tier above that too. This obviously creates a vast audience, and increases your chances of your home being found significantly.

For example, rather than placing your price at £199900, place it at £200000. Even though £190000 sounds cheaper, you are losing out what could be double your current audience.

Property buyers will often (using Rightmove) search on both ranges £150k-£200k and £200k-£250k. This is likely because they have a small amount of leeway over the top of their budget, e.g they can afford up to £260k.

The reason for this is most likely because they usually know that they can pull the price down a bit once the sale is in action.

If your house price is £199900, it will only be seen in the £150k to £200k category. This means that you could be missing out on those buyers that have a budget of £200k and more.

However, if you change your price to £200k, it will now appear in both categories. This means that your house is now visible to those who can afford houses up to £200k, and people who can afford £200k and above.

What if you are selling your house and had no viewings?

If you have listed your house, and not had any or barely any viewings, this is very likely because your house is in the incorrect Rightmove Price Band. Not only should you aim to price your house around its size, location and condition, but you should also think about the likely searches people would find in that Price Band on Rightmove as well.

E.g. If your house has been priced at £255000 and a lot more amounts of homebuyers are searching in the range of £200k to £250k, you are missing out on this target market. However, if you reduce your houses’ price to £250k, you will be included in that category too. Plus you can always add extra charges at the end to get it back up to £255k!

Stamp Duty Price Bands:
When your property has been priced, and you are ready to sell, you must keep Stamp Duty Price Bands in mind too, as they are very important. Currently, because of Covid-19, SDLT rates have reduced, until the 31st of March 2021.

The table below gives an illustration of the SDLT rates that will be applied  from 1st April 2021:

Property or lease premium or transfer value                                              SDLT rate
Up to £125,000                                                                                                  Zero
The next £125,000 (the portion from £125,001 to £250,000)                2%
The next £675,000 (the portion from £250,001 to £925,000)              5%
The next £575,000 (the portion from £925,001 to £1.5 million)           10%
The remaining amount (the portion above £1.5 million)                         12%

Luckily, the extra amount that the buyer pays in Stamp Duty when a property is moved into a higher band, is the higher rate that Stamp Duty’s excess in price over the lower band.

Overall, Rightmove is likely one of the most tip-top at Price Bands, and organising house prices into tiers or categories. They allow you, the seller of the property to be introduced to a larger audience then usual, and it gets your house out there and seen by thousands of homebuyers.

Thanks for reading, happy selling!

The post Rightmove Price Bands – How Does It Work? first appeared on Ready Steady Sell.

source https://www.readysteadysell.co.uk/rightmove-price-bands-how-does-it-work/

So, you’ve sold your property, and now your buyers are dragging their feet.

What do you do if your buyers are dragging their feet? If your buyers are dragging their feet, give them some form of choice or ultimate to complete by a decided date, or you will re-list the house. You can get your solicitor or estate agent to find out why they are dragging their feet, as people tend to not drag their feet unless something is wrong with the property in some shape or form. It may be problems related to taking out a mortgage, or problems with their own house sale even.

Once you have figured out what the house buyers are upset with, you are in a better position and mindset to take action depending on the circumstances. However, it should really be your estate agent/solicitor that does the chasing. Moreover, they should be doing their job, which you pay the, for, to keep the sale moving forward. They do not get paid if the sale doesn’t go through.

What are the 5 key reasons why your house buyers could be dragging their feet?

There are obviously many possibilities as to why your individual house buyers are dragging their feet, however, it is unlikely to be deliberate and more likely that there is a problem they have not yet disclosed with you. For example:

1. They may be having problems with their own house sale.
2. Your buyers may have offers on a number of properties.
3. Your buyers may be getting cold feet.
4. They buyers may have slow performing solicitors.
5. They may be having difficulties obtaining their mortgage.

They may be having problems with their own house sale.

Your buyers are very likely in a conveyancing chain (A property chain is a number of linked conveyancing transactions that are all reliant upon each part of the chain to complete.) and may be dependant upon their house selling, in order to be able to actually buy your house. If this turns out to be true, and their sale is taking more time than expected to sell, or if their sale has fallen through eve, you should know as soon as possible.

The majority of the time when this happens, buyers are reluctant to tell the sellers of the house about it. Most of the time, they hope to find another buyer and it may be this is what is actually causing them to drag their feet. You can get your estate agent/solicitor to make enquiries about what is causing the delay, however, if the buyers lie, or don’t tell your solicitor/estate agent, it could cause  havoc for you.

Your buyers may have offers on a number of properties.

When someone goes out to buy a house, they look at a few before putting an offer on one. A lot of the time, buyers put multiple offers on multiple properties. This tends to be touched upon when the property sale moves into the conveyancing stage. It is at this stage in which the buyer should begin committing funds to engage solicitors/estate agents in the purchase, and to know that the buyer is serious about the sale.

It is highly unlikely that your buyers would commit up to two sets of conveyancing fees on two separate properties unless they are investment purchases. But it is possible, and could at any time happen.

It is also unlikely they that they will have multiple separate mortgage applications in the process, unless, of course, they happen to be investors. It is important to deal with this issue as early as possible, to avoid last-minute pull-outs right before the exchange of contracts, as they could end up going for the other property.

Your buyers might be getting cold feet.

Are your buyers getting cold feet, and thinking twice about purchasing your property? What can you do about it?

Firstly, how can we deduct when a buyer is getting cold feet – what are the symptoms? One symptom could be that your buyer is trying to find any little problem with your property to help them with their pre-buyer nerves or fear. This can also affect when you find your buyers are carrying out what appears to be far too many checks for the house sale.

The buyers may have slow performing solicitors

One of the biggest problems faced by house buyers slowing down the house sale is the speed of the solicitors. The reason this problem is so bad is mainly because house buyers don’t actually realise it. Most of the time during house sales, solicitors blame the other sides solicitors for their own problems and mistakes. If you think that this is down to your buyers solicitors, rather than yours, you need to speak to your own solicitor to push the sale forward. Sometimes solicitors need a little nudge to get your sale to the top of their pile. In the worst case scenario, you might have to advise your buyer to get new solicitors.

They may be having difficulties obtaining their mortgage.

Your buyers may be facing some level of difficultly getting a mortgage on your property for any number of reasons. One way to spot this is that if the valuation has already occurred and yet there are still delays.  You should get your estate agent/solicitor to find out what the problem actually is, especially if it has been a few weeks or months even since the surveyor has checked on your property for your valuation.

If a problem has actually been picked up by the survey, for example an issue with damp. This may be what is causing the delay, and if so your solicitor should let you know. If this issue is what is causing your buyers to rethink buying your property, you should try to find this out as early as possible.

On the other hand, if you know that your buyers need a mortgage, however no survey has yet taken place, this is an easy, clear sign that there is a problem. Try to get your solicitor to enquire your buyers about it.

What are the best ways of pushing buyers who are dragging their feet?

1. Give your buyers an ultimatum (definite choice) to exchange contracts by a given datem or you will relist the house onto the market.
2. Offer a small discount on the overall sale to encourage your buyers to go forward with the sale.
3. Offer an exchange with a long-stop date or delayed completion.

Give your buyers an ultimatum (definite choice) to exchange contracts by a given datem or you will relist the house onto the market.

This is the best way to pushing your buyers into purchase if they are dragging their feet. The type of ultimatum that always works best is giving them a deadline to which the exchange must be made by.

The ultimatum should also always state that if the exchange isn’t met by the set date, you will relist the property.

There is nothing like a deadline that gives people a clear focus, and fear of loss. It brings out the truth of whats wrong. It could tragically backfire, and you will lose the sale, but in reality it is better to have a decent sale than buyers who aren’t sure, or are taking too long with the sale on their side.

The advantages of how an ultimatum will remove each of the reasons for dragging their feet are as follows:

• Problems with their own house sale: If your buyer’s house sale has sadly fallen through, or if it won’t sell, they won’t be able to commit to a set exchanging date. They will either have to pull out of the exchange or ask for an extension on the date.
• Offers on multiple properties: By giving a buyer an ultimatum when they have multiple offers on multiple properties, it can force them to make a choice. Are they willing enough to choose your property, or back out. Both options are beneficial for you.
• Buyers have cold feet: An ultimatum will jolt the buyers with colt feet to make a hastily made decision, either buy or back out.
• Slow performing solicitors: If your buyer’s solicitors have been slow up to now on your sale, they may also be slow to respond to this type of ultimatum. However, if you involve your estate agent or solicitor, they can easily speak directly to your buyers and their solicitors. This should further push them into flushing out the real underlying issue.
• Problems obtaining mortgage (finance): If your buyer is having issues finding a source of finance to purchase your house with, they will not commit to an exchange of contracts. If they have no way of affording the mortgage, they will hold out as long as they can until they can get the money. The ultimatum will get them to tell the truth about their financial issue, and you can make a decision from there.

Offer a small discount on the overall sale to encourage your buyers to go forward with the sale.

By offering a discount on the sale of your property, as long as they complete the sale by a certain date may be enough them encourage them to stop dragging their feet. IT can also help with deducting what is the real issue causing them drag their feet in the first place.

Offer an exchange with a long-stop date or delayed completion.

The positive of offering an exchange of contracts with some form of delayed completion is that in the chance your buyers accept these terms, you have your sale contracted and it cannot the fall through.

This strategy does, however, need the whole conveyancing chain to accept the same conditions, which may not be possible. But offering this in the first place tends to flush out any financial issues.

Buyers won’t commit to any forms of exchange, even ones with longstop dates, if they do not have finance set in place.

In conclusion, the best way of avoiding the overwhelming stress of buyers dragging their feet is to sell your current property, and rent a property before buying again. By doing this, you are splitting your move into two separate steps, making it much easier, and clearer for you.

If you only have to focus on selling your house, you aren’t stressed out about any buyer delays and how this impacts on your ongoing purchase.

Overall, you should be patient with your buyers, but patient to an extent. Don’t let them walk all over you. Set deadlines, set payments that they must pay, and make sure both your, and their solicitors (or estate agents) are decent, and up for the job.

Thanks for reading.

The post Are your buyers dragging their feet? first appeared on Ready Steady Sell.

source https://www.readysteadysell.co.uk/are-your-buyers-dragging-their-feet/

Are you about to sell your house, but haven’t thought about a gas safety certificate until now? You may be asking yourself, ‘Do I need one to sell?’, ‘Is it important to have one in the first place, even when I’m not selling?’. Do not fret. This article will tell you everything you could possibly need to know about gas safety certificates, inspections, boiler installation certificates and so on.

What are Gas Safety Certificates?

Firstly, lets define a gas safety certificate to avoid confusion. A gas safety certificate (also called a ‘landlord’s gas safety check’), is required by law for any and all property used as rental accommodation in the UK where gas appliances exist. The gas safety certificates are kept up to date by Gas Safety Regulations 1998. Every gas appliance is required to be safety checked and regulated every 12 months.

Who issues gas safety certificates?

Registered gas safety engineers are the only people that can legally carry out a gas safety check. To do so, they also must be members of a company approved by the Health and Safety Executive. The gas engineers must also be on the Gas Safety Register. If you think you have been issued a certificate by someone who isn’t in the required checklist, or you haven’t been issued one at all, it is indeed recommended that you have one.

Who needs a gas safety certificate?

It is suggested that every homeowner that has gas appliances needs a gas safety certificate, just to be safe. However, all landlords are required to have a gas safety certificate issued every 12 months on their properties.

Do I need a gas boiler safety certificate to sell my house?

If you do not own a gas boiler in your current place of residence, you do not need a gas safety certificate to sell your house. It is, however, good practice to have annual inspections and safety checks completed for your own safety, so that you can provide this to your buyers as a way of pulling them closer to the sale.

On the other hand, if your property is buy to let or HMO with a gas boiler, then you need to have a gas safety certificate to have any tenants living there, in all cases. The only way around this, to sell your buy to let/ HMO property, is by having no tentants letting.

What are boiler installation certificates?

Valid installation certificates at the point of installation is required by any and all gas boilers. Essentially, the installation certificate is an official ‘Building Regulations Compliance Certificate’. This certificate can only be issued by the Gas Safety Register. They are able to notify your local authority whether your installation complies with the buildings regulations.

This of course means that only a registered and compotent gas engineer can install boilers.

Are You able to Sell without a Boiler Installation Certificate?

Under any circumstances, it is impossible to sell a house without a boiler safety certificate, or the Building Regulations Compliance Certificate. This certificate confirms the boiler was installed under the accordance of the building regulations.

If you think you have lost your certificate, do not panic. You can easily apply to the Gas Safety Register for a new one. It does cost a bit of money, but it is cheaper than losing the overall sale of your property.

Why do you actually need the Gas Safety Certificate?

There are a lot of decent reasons, but here are the main two why gas safety certificates are needed:

Reasons Why The Gas Safety Certificate is required:

1. A gas safety inspection prevents gas leaks by checking for them.

Gas leaks are very dangerous, as they can cause fires and explosions. This is why, as part of the gas safety check, the engineer will visually inspect pipework and do the tightness test on the pipes, just to confirm there are no leaks at all.

All safe appliances are still designed to burn gas in a very safe and controlled way. However, a faulty appliance, including even a lose screw, may leak gas and cause a fire or an explosion. The gas engineer checks to confirm the appliance is indeed working as it should be, without any leaks.

2. The inspection also checks for, and prevents, carbon monoxide poisoning.

The deadly, poisonous gas Carbon Monoxide is in your pipes. It is impossible to taste, see, or smell, and that’s where most of the danger comes, as you won’t be able to tell if it is in the air. If an appliance or pipe is leaking carbon monoxide, you won’t actually know.

Thankfully however, gas safety inspections can help this. It is safe to have your appliances checked, to make sure your appliance isn’t leaking carbon monoxide.

It is also safe to own a carbon monoxide detector in your home however, as the check only happens once every 12 months or so.

What happens to you if you don’t own a gas safety certificate.

If you do not own a gas safety certificate, you are not only putting yourself at risk of death or injury, but your family too.

However, if your property is let out to tenants, you are putting your tenants in serious danger. This is committing an offence, of which you can be put in prison for a long time for.

What are the overall penalties for not having a gas safety certificate?

The penalties include: substantial fine, and/or imprisonment; and it could invalidate your insurance.

Also, a fire or explosion that happens, when the appliance is faulty and hadn’t been safety checked (if causes death to your tenant(s)), you can be imprisoned for manslaughter, and if it only caused injury, they could sue you for all your worth.

So, overall, can you sell a house without a gas safety certificate?

Yes, you can indeed sell your house without a gas safety certificate, as it is not required by law at all to have one, However, if you have a gas appliance, it is also recommended to at least have annual gas safety inspections and if you let your property you are required to have a gas safety certificate issued once a year.

It is a lot safer if you do own a gas safety certificate, however. It is not too expensive to get your house thoroughly checked, and if you don’t have one, it can affect your overall sale on your property. It isn’t really worth the risk, and you will come out more positively on the other side once you own a gas safety certificate.

If you own a property in which you are letting out to tenants, however, you should have a certificate, and also appliances checked every 12 or so months. It is required by law, and keeps you and your tenants out of the way of danger.

Thanks for reading.

The post Can you sell a house without a gas safety certificate? first appeared on Ready Steady Sell.

source https://www.readysteadysell.co.uk/can-you-sell-a-house-without-a-gas-safety-certificate/

What is the value of an acre of land in the UK? This is an old age question that doesn’t always have a definite answer. The value of land is determined by numerous variables thus working out a price tag can be a mind-boggling at times.

How Much is an Acre?

The term acre originates from an old English word for a field. It was used to refer to the amount of land a yoked pair of oxen or a man could plough in one day. Thus, the original old acre was very much varied based on the terrain or condition of the cows.

Presently, an acre is equivalent to about 43, 560 square feet of land. However, in farming an acre is described as a piece of land measuring 660 feet long and 66 feet wide. If you still can’t visualize an acre, think of a soccer field that is somewhat a little larger than an acre of land.

You can comfortably pack up to 150 cars in an acre of land or fit in 16 tennis courts, arranging them in a rectangle. In terms of property development, a housing developer can fit at least 18 homes on an acre of land.

How Much is an acre worth?

Before you get to pricing land per acre, you need to first understand the area covered an acre is in the first place. Today, an acre of farmland in the UK is valued at between £12,000 and £15,000. The price will usually vary depending on the location of the land. You could even pay £25,000 for an acre depending on several variables. For instance, an acre of land that is located next to your home could cost upwards of 50,000. This may sound ridiculous but the reason behind this is the value this land will add to your home.

Purchasing an acre or two is usually more expensive and difficult compared to purchasing larger parcels of land. This is because you’re more likely to get a discount when purchasing more acres than when you’re buying an acre. Here’s why; it’s easier to get more people buying an acre of land at between £25,000 – £30,000 than it is to find people buying one hundred acres for £600,000. This means that an acre of land will be going for £6,000.

Why does the Size of an Acre Matter?

Whether you want to buy a farmhouse or land to develop, it is important to first know how much an acre is. Today, most properties are measured in terms of acreage. If you want to buy land to build a home, you must first determine the value of an acre especially if you intend to go for mortgage financing. If the bank approves a £250,000 mortgage and the land is valued at £100,000 per acre, then an acre would eat up to 10% of your budget.

Factors that Affect the Value of an Acre of Land

The value of land is often pegged on several variables. For instance, the proximity of the land to utilities will certainly increase the value of the land. If the land already has electricity, a barn, a couple of stables or water, the value will be more expensive. Here are factors that influence the worth of an acre of land;

• Supply and demand: As an area grows and development shapes up, desirable land becomes scarce. This eventually drives up the price.
• Location. Overall, land that is near major cities will usually cost a lot more than suburban and rural land. Similarly, land that is located along the coast is costly than land that is in the interior. For instance, it is unlikely that you will pay less than £1,000,000 for an acre of smallholding farm with a house on it near London. Your best chance for finding a more reasonable price is if the house is on an acre that is protected from development. This means that the land is valued as a smallholding or garden.
• Economic activity. The economic activity of the area where the land is located will usually have an impact on the value of the land. As new businesses are established in an area, there will be workers and their families coming along. This will significantly increase their need for housing, parks, schools and other social amenities. Consequently, the value of land will go up. On the contrary, when the area has too many layoffs and subsequent closure of businesses the value of land will drop.
• Environmental factors. The value of an acre of land in areas that are prone to natural events like earthquakes, floods or landslides will often be on the lower side. Similarly, land that is located close to a nuclear or chemical plant that has a perceived risk of danger will also cost less. This is contrary to land that is perceived to have the potential for mining precious metals.
• Topographic features. While some acres of land are aesthetically appealing, others are not. Thus, you will pay more for an acre of land that overlooks beautiful views, has good drainage and level surfaces. These are great features as they contribute to the bigger picture of perfect lawns, pleasant gardens with mature trees as well as foliage.
• Surrounding structures. If an acre of residential land is situated close to an industrial area, it will cost much less than an acre situated near a recreational area or a lake because the former is likely to be prone to pollution and other industrial factors that pose as a risk. Land that is situated close to amenities like health facilities, good schools and parks are more expensive.
• What you intend to do with the land. The kind of development you want to make on the land also contributes to the value of the land. The value of land for housing versus the value for land for farming will be different.

The price of an acre of land dropped significantly after Brexit before picking up again. Ultimately, you must understand that the process of selling and buying land for development is a high stakes game. You must be well prepared before you get to the negotiation table. Failure to prepare or even understand issues relating to land transactions and ownership can be punished heavily.

If you’re selling land to a developer, you need to keep in mind that developers tend to take advantage of exclusions to drive the price down. Thus, you need to be on your guard. Know the gross value figure per acre that your land is worth when you include the planning consent. Developers may ask for discounts for costs related to the development of the land so you must have a good understanding of such costs and deductions to be sure that they’re justifiable and reasonable.

Generally, the cost of land that targets sizeable plots for construction of larger detached buildings often cost less compared to a site targets for a larger number of smaller buildings that are easily marketable. This will affect the price that they will offer you. Selling land as a developer is lucrative but make sure you’re not treated unfairly by the developer, process or both.

The post How Much is an Acre of Land Worth in the UK? first appeared on Sell House Fast | The Smart Way To Sell Quick | Ready Steady Sell ™.

source https://www.readysteadysell.co.uk/how-much-is-an-acre-of-land-worth-in-the-uk/

Divorce is one of those periods of time in life that can impact immensely on your emotional sanity! If you are lucky enough to reach an amicable agreement and decide to part ways without conflict and disagreement then you are one of few couples able to achieve this!  Unfortunately, that once felt emotions of love, care and commitment till death do us part can quite easily turn to hate, resentment and the need to distance oneself from the other! This is life in the land of relationships and marriage for many couples.

How can we reach an agreement?

Perhaps where things get more emotionally heightened is when children, possessions and property become juxtaposed between the parties wishing to go their separate ways. Children quite often bear the brunt of revenge tactics from partner to partner and are quite often treated like pawns in a game of love and hate! While possessions with or without emotional attachment to either party can be used to inflict hurt whether keeping, selling or destroying, let’s say for example the ex-wife’s favourite designer bag or the ex-husbands expensive golf clubs!! It can quite simply become an emotional war zone for many couples going through a divorce! The brewed up emotional bubble cooking away beneath the surface of the divorcee can often lead to rash thoughtless decisions being made and hastened unthought through actions inflicted upon the ex-other half! In the mind of a resentful divorcee Consequence rarely drifts to the forefront of the mind!

Society over the years has changed towards the perception of gender roles within a marriage. Not long-ago women were expected to stay at home and pick up the role of dutiful housewife, while men would be the hunter gather or bead winner as it was commonly called! Roll on feminism and the rights of women and society began to change to expect women to get up, get out and work to contribute! No longer relying on the male counterpart of a marriage to bring home the bacon! With women now largely contributing financially to the income of the home, mortgages and possessions bought throughout the time of marital bliss would now be considered rightfully half and half. After all, by law legally it is so!

Who has the rights to the property?

There is however a top-heavy expectation when a divorcee is on the cards for a man to leave the family home as the woman is still unfortunately seen as the weaker sex, yeah, I know years of activism for equal rights and this is still the perception of many! It is still very much so the case that a woman will remain in the family home, more so if children are involved! But what happens if the ex-husband decides he wants to sell the home? Or if you want to sell the ex-marital home? Firstly, if both parties are joint owners of the property then the sale of a property cannot be forced by either. In an ideal world coming to a workable agreement between yourselves would be the most desirable achievement if either party wanted to sell. Buying them out or selling your share of the property to them is one way of achieving this. The often-lengthy process of selling a house can often cause unnecessarily prolonged emotional disruption so selling a house quickly is often an attractive solution.

What if I am the Sole owner of the property?

Even if the ex has no claim to the property through legality, they can apply for a matrimonial home rights notice, which puts a stop to any changes through mortgage or sale without first notifying them. If you or your ex are wishing to sell the ex-marital home often the thought of splitting the sales proceeds can influence the other party into selling the house, while another option is to buy the other party out if you are afforded to do this! More often than not emotional attachments to a property can be the decisive factor is proceeding with a sale! Selling a home quickly can often be the best solution to this as you will not have to deal with a lengthy home sale that will mean daily war with your emotions on whether to sell or not!

If an agreement is deemed unreachable between either party, consulting a lawyer can aid in reaching a solution by providing legal support and guidance. An order of sale can also be applied for through the courts, allowing you if successful to obtain a sale by right.

What if children caught up in the middle?

As discussed, earlier divorces can become much more complicated when children are involved, if the courts become involved their welfare and needs are paramount. Divorces can often be emotionally damaging for children so to limit disruption it is generally favoured for younger children to stay in the family home. If you are the primary caregiver there is a strong chance you will gain the rights to the house, however this is not always the case. A Mesher order will often be implemented by the court, allowing for children to stay in the home till they are of a certain age or have finished their education. This is on a case to case basis and is not always guaranteed. Seeking legal advice is recommended to get the correct information for your situation.

What are the next steps?

It’s always the best solution to try and keep things out of the courts, which of course with heightened emotion is not easy. A collective agreement is commonly agreed that one party buys the other out, which in turn can be kept or sold. However, affordability can often hinder the buying of their share, and difficulty of mortgage payments on their own.

What are other options?

Options are still available if this is the case. Refinancing can be looked into, pending on good income and credit score, which can provide funding to move forward with a purchase. If after all this is put forward but an ex is still refusing to play ball and sell, an order of sale can be obtained from a court.

An order for sale can be obtained via the successful attainment of a county court judgement. For obtaining a hearing would need to be attended. Both sides would be taken into account. Successful award will warrant the right to take possession of the property and proceed with a sale, with all proceeds to be split accordingly. If an order for sale is not issued by a judge, usually there is an alternative put in place such as a Mesher order as mentioned above, delaying the sale but not indefinitely.

More often than not resolution can be reached without ever having to take it to a court. Lengthy discussions, and understanding of each other’s wants and needs can save time, money and further heart ache! Here at ReadySteadySell we understand the need to move things quickly to avoid unnecessary stress and disruption caused by divorce. When you reach an agreement with your ex-partner, we can get your house sold quickly and easily, allowing you to move forward with your life. We offer free quotes and can sell as little as 7 days or a timescale to suit your needs.

The post Can I be made to sell my home by my ex Husband? first appeared on Sell House Fast | The Smart Way To Sell Quick | Ready Steady Sell ™.

source https://www.readysteadysell.co.uk/can-i-be-made-to-sell-my-home-by-my-ex-husband/

Inheriting a property can be a time of mixed emotions, sadness, sentimental attachment, and a curiousness to how much the property may be worth. These emotions may be maximized or added to, if i property is inherited by more than one family member. Especially when there are conflicts whether or not to sell the property! As everyone will want to obtain their share in some plausible way.

The important thing to know if you have inherited a property with siblings is that the inherited property can only be sold with the agreement of all parties involved.

Inheriting a house! What is the process?

Inheriting a house with siblings can often lead to lengthy, complicated processes. This is due to the very nature of different viewpoints and opinions of siblings involved. Along with the emotions that comes with an inherited house, personal reasons of each shareholder involved may lead to even the strongest of sibling bonds becoming tested.

It is often the passing of a remaining parent that frequents the inheritance by multiple siblings of a house. Now a vacant home is most commonly sold and money split amongst the shareholders. Other alternatives to selling, is renting the vacant inherited home out and sharing the income from rent. Additional estate agents cost and services are avoided in the case of rental by choosing to rent out to a family member.

Inheriting a house, can one sibling force the sale?

In any case of house inheritance that involves multiple siblings with different options on whether to sell or keep, force of the sale by one person cannot be done, everyone has to be in agreement. It is not impossible for one shareowner to sell their share of the home if they so with, however it is highly unlikely that sibling will find a buyer for a share in a home with disputing siblings as the other shareholders.

If there is dispute between you wishing to keep the property against your siblings wishing to sell, they can approach a court and ask to issue an order to sell. This process involved them writing to all shareholders of the property via a solicitor, dictating forward a strong case as to the reason selling would be the best option. Discussions and disputes on the sale can be had throughout this process.

A convincing argument as to why the sale of the house is the best option would have to be put forward by the sibling eager to sell in order for the law to go in their favour.

It is important also to be aware of inherited houses that still have a mortgage as this can impact the process. 

Inheriting a house, sharing ownership in a reasonable manner.

Resolution can be reasonably achieved by siblings agreeing to keep an inherited house. Two following scenarios can show how ownership together can be achieved.

• Equal rights are held by all siblings that are joint tenants. In the event of a sibling dying their sare would be passed to the other joint tenants. The surviving sibling can leave the property to someone else in their will as they will then be the only shareholder left to legally own the entire property.
• If the decision is made by the siblings to become tenants in common, A defined portion of the house will then be owned by each sibling.

If the agreed preference by all siblings is the sale of the inherited house, then the funds obtained from the sale of the house should be legally split between them on the percentage owned by each shareholder of the property.

Inheriting a house, what happens if I live in the house?

Complexities can become elevated in the case where you live in the house you and your sibling have inherited. However importantly, legally no one can force a sale! Remaining in the home is a legal right by the sibling living there at the time of inheritance, although now the other siblings too have a right to live there. A court exclusion order can enforce the removal of someone to leave the home however this is in severe cases, with compelling reasoning as to why that person needs to be removed. The wishes of other siblings to sell the home is not a reason acceptable by the court. Evidence would need to be provided to the court to prove serious incidents that warrants the removal of the individual from the property.

If agreement by siblings to sell is reached, there are several things needed to be taking into account, the cost of selling being one, and how fees such as these will need paying.

Inheritance tax is often required on inherited properties along with other potential taxes required, it is important to ensure you know ahead what will be required to be paid when selling your inherited property. A quick and easy way to find out how much tax will be expected can be found by using our tax calculator.

If you have recently inherited a property and your looking to sell quickly and easily that contact us at Ready Steady sell for your free offer today.

Sell with Ready Steady Sell in as little as 7 days, or timeframe most suited to you. Visit our website for more information.

The post Inherited Property, Can Siblings force a Sale? first appeared on Sell House Fast | The Smart Way To Sell Quick | Ready Steady Sell ™.

source https://www.readysteadysell.co.uk/inherited-property-can-siblings-force-a-sale/

Finding the best estate agent for you

Where do I start?

If you’re thinking about selling your home you will want the best estate agent in your area or online to help with the job. An accurate valuation of your home, and the setting of the right asking price are among some of the aspects of a good local estate agent along with sharing information on how to maximise the sale price you can achieve, selling in a realistic timely manner and to be updated with market knowledge and conditions. Furthermore, a good estate agent will have a reputable track record of sales success within your area.

Doing your homework in advance and speaking early on in the process to estate agents is advisable even if you don’t plan on moving for a while.   

A needle in a haystack? How do you find the best local estate agent?

They all state they are the best so how do you find the best for you? It might have been a while since you last experienced the process of using an estate agent, and like all things change happens so going back to the estate agent previously used doesn’t necessarily mean you will obtain the same good service received way back. It is better to shop about and compare a few agents before committing yourself.

Ready steady sell will help you find the best estate agent for you by giving you access to the data from over 18,000 estate agents from thousands of different websites. Readysteadysell provides you with accurate data on agent’s performance, so you can find the estate agent that best fits your needs in your area.

At Ready Steady Sell Our find an estate agent tool allows you to compare: How: quickly estate agents sell homes like yours, the success of achieving asking prices, their fees, the agent with the highest property sales and the ones with the biggest shares in the market

Results at readysteadysell are instant, free and can be arranged for ease of:

Comparison of: agent most successful, agent achieving the asking price most frequent, fees charged, length of time taken to sell.

To find the best local estate agents near you, simply enter your address details so we can find local estate agents selling houses like yours.

The next step is using your results to draw up a shortlist of estate agents to approach. Unlike other estate agent finder tools, you can compare the data yourself and contact the agents you want to speak to.

Valuations 

Free valuation is offered by all estate agents as this is an opportunity for them to meet you face to face and hopefully win your business. The best estate agents will be able to back up the valuation they give you with evidence of properties like yours locally that have recently sold at that price.

The estate agent with the highest valuation doesn’t necessarily mean you will achieve that price. Some estate agents will do this to entice you to sign up with them. Homeowners in the past tended to decide between agents by going with the highest valuer of their home. However, this approach presents several pitfalls to a house sale. Overpriced properties stand out like from other homes on sale, as tenants and buyers will both always compare like for like. This can result in the property sitting on the market for far too long and will be a waste of valuable homeowners’ time. Property valuation for mortgages purpose may well even fail if even a buyer is found.

Asking them to give you their view about whether there are any home improvements that need doing to optimise your sale price before listing it can be a good thing.

Typical estate agent fees

The vast majority of estate agents on the local high street will work out their fees as a percentage of the sale price. Estate agents’ fees can range generally from 1% to 2.5%. In order to avoid any confusion, it is important to clarify if the fees quoted are inclusive of VAT. Clarification of actual fees should be sought from the estate agent by the homeowner so you know exactly what is expected of you to pay.

Many estate agents’ fees are negotiable if they feel a property will sell easily or to undercut a competitor.

Transparency about estate agents’ fees charged was reported in 2018 by Zooplas state of the property nation report to be 56% an important factor by home sellers when selling a house. Our ready steady sell estate agent comparison tool lists how much local estate agents charge so you can see which estate agent comes out best.

Published commission fees are not set in stone and can be negotiated. Only 1 in 4 people negotiate commission fees of estate agents according to estate agents choice research.  Around 1% for a sole agent contract is the fee you should be looking to pay, if the fee is higher than this you should ask the agent what can be done to reduce it. Remember, estate agent fees normally exclude VAT, which is currently 20%. Make sure you do the calculation and include VAT so you know your total amount you’ll have to pay your estate agent.

Comparing Agents to find the best

Ready steady sell provides a free estate agent comparison service to aid homeowners and tenants in finding the best estate agents around. Using independent property sales data, the easy to use agency comparison service works in helping you make an informed decision before proceeding with an estate agent to sell your home.

Ready steady sell offer free instant results based on statistical data so you can confidently find the best estate agent for your needs. The National Estate Agents Association can to help you find a reputable estate agent

The Three agency types:

Sole agency: leaving you free to privately sell your property by your own efforts without any payment of commission. Instruction of other agents can be sought however if they sell the house payment of commission to the original sole agent as well as paying the agent will have to be considered. Agreement of a sole agency agreement will usually state how long this period of sole agency will last. When the period ends you are free to use one or more additional agents.

Joint agency: Using one or more agents, commission goes to the agent who achieves the sale sometimes this can be shared.

Multiple agency: you can instruct as many agents as you wish, however commission will be claimed by the agent who sells. This will be the highest option available in costs.

Using online estate agents.

It is worth considering when thinking about your home using an online estate agent. Lower fees tend to be offered by online estate agents along with a different model of service. As there are no high street branches, they are able to operate online resulting in lower fees being charged. Yopa and Purple bricks are among some familiar online estate agents.

The advantage of marketing your home on the internet through property portals is attractive as well as lower fees therefore it is worth looking at what they offer and how they work.

Payment upfront is often required by online estate agents. Often working out more expensive than the traditional high street agent, however their pay on completion packages may convince you that your money won’t be wasted if you fail to sell with them.

Online estate agents are also increasingly offering a hybrid model, with the best bits from high street and online estate agents. Most notably, most online estate agents now offer to conduct viewings for an extra charge. So, it is worth looking at the packages they offer and thinking about online estate agents when choosing the best estate agent to sell your home.

Complaining About a Bad Estate Agent

All estate agents must belong to one of the following redress schemes to deal with complaints:

• The Property Ombudsman
• The Ombudsman Service
• Property Redress Scheme

The post How to compare estate agents first appeared on Sell House Fast | The Smart Way To Sell Quick | Ready Steady Sell ™.

source https://www.readysteadysell.co.uk/how-to-compare-estate-agents/

Is it ok for me to sell my house to my son or daughter for £1?

If agreed on both sides, it is legally possible to sell your house to your child for as little as £1. Other costs however need to be considered for example: Stamp duty, potential inheritance tax, along with legal costs can contribute to unexpected rapidly rising costs.

First time buyers have for a long time faced an uphill battle when it comes to getting on the property ladder.  Now even more so! With the world thrown into an increasingly uncertain time with coronavirus. These uncertain times have brought extra struggles for those homeowners wishing to sell their homes such as drops in house prices and the increased requirements of mortgage lenders. It is not surprising in the current economic climate homeowners now across the UK are looking to assist their children on to the property ladder. Here at Ready Steady Sell we understand the uncertainty felt by many homeowners and are ready to assist with information sought should you be considering selling your house to your child below market value.

Giving money to my child to buy a house, can I do this?

In the days before the pandemic mortgage lenders gladly accepted money gifted when boosting a prospective buyers mortgage application. Unfortunately interest rates hit a historic low as a result of the world’s battle with coronavirus, mortgage lenders in order to financially survive had to adapt and change. Prior to the uncertainty of the times, mortgage lenders would accept a deposit as low as 5% for some houses, rising to 15% minimum at the start of lockdown! This has since been lowered to 10% but still higher than what potential buyers would have been planning to pay.  With some applicants now being forced to find alternative ways to increase their deposit funds.

If gifting money to your child to assist with a house deposit is something you are thinking of doing, be certain to check ahead with their lender that this would be accepted. Rules have been implemented by some mortgage lenders such as Nationwide, that limit gifted deposits, along with applicants providing evidence that it is their own savings (at least 75%) and not gifted money that will assist their mortgage application.

If I sell my house for £1 to my child what other costs do I need to consider?

Doing your research and being fully aware of the process along with extra costs is something you need to be sure to do. Taking this precautionary step will prevent you stumbling into difficult situations as you navigate through the process and move forward with confidence. Common costs include:

1. Mortgage – If you do not own your home outright then repayment of the mortgage will need to be cleared before you can progress to selling your house to your child under market value. Complications can arise when homeowners take out loans to clear existing mortgages.
2. Capital Gains Tax – Capital Gains Tax will be required to be paid if you are selling a house to your child that is not your primary home. With Capital Gains Tax depending on your income tax status, 18% if you are on Basic rate and 28% if you are a higher-rate taxpayer.

How is Capital Gains Tax calculated?

The market value of the house and not what you sell it for will be used in calculations when working out the amount of tax that you will need to pay if you sell your house to your child. It is advisable to work out how much capital Gains Tax you will be expected to pay before you proceed in selling your home! A house with a market value of £200,000 will require a payment of £36,000 Capital gains tax, meaning a very large amount of money owed to the taxman and only £1 obtained in the sale of the house.

Legal fees

A legally registered profession will need to be paid to ensure the legality of the proceedings and oversee the handling of the deeds, taking the property out of your name and putting it into your child’s name.

Stamp Duty, will i need to pay?

It’s a relief to know a stamp duty holiday was put in place until March 2021 by The chancellor of England, however it is worth noting here that selling to an immediate relative such as your child will let you cut stamp duty as there is already an exemption in the rules.

If a property value exceeds the threshold of £425,000 an inheritance tax would need to be paid  by a family member if that property was gifted  7 years before your death.

Selling my house to my child, are there any risks?. 

Any house sale will bring with it some sort of risk, unexpected issues with the property, house sales falling through, not getting the price you were asking, these are only a few risks that may occur when selling a house. However when selling a house to a family member things may be a little different, the emotional aspect is one thing to consider! Putting together an agreed plan after the sale of the property is advisable: will you be moving out the property for your child to move in, or will you continue to live in the property and pay them rent to help with costs? All future plans need to be thought through to save yourself from the emotional rollercoaster that may arise when selling to a family member! Eviction from a family member who first agrees to rent to you then decides to change their mind is not a nice experience for any parent! Bearing in mind if you sign your deeds over to your child you will no longer have any legal claim to being their so you will be depending on the good nature you hope you have instilled within them! Another thing to consider is that when selling your house to your child if they are married at that time and go on to divorce, the house would then need to be sold to settle divorce proceedings. If you do not at that time have the funds to buy back the half of the house belonging to the spouse you will be at risk of losing the house and leaving you with the risk of being forced to find somewhere else to live! So be cautious and think ahead with your plans.

Selling your house to your child for £1 is something that needs to be carried out with caution! Consider the taxes that you will both need to pay, go through the risks potential that may be involved, and discuss your long-term plans and ensure they are in place. If you are looking to sell your house to your child and you need more information, you can get in touch with us. Ready Steady Sell can provide you with a free cash offer and show you how you can sell your house in as little as 7 days.

Selling my house fast! How do I begin?

If a quick house sale is what you need look no further! Ready Steady Sell can get you a FREE cash offer on your house and show you how you can have your house sold in as little as 7 days. If a quick house sale is what you need, don’t delay getting in touch today!

The post Can I sell my house to my son/daughter for £1? first appeared on Sell House Fast | The Smart Way To Sell Quick | Ready Steady Sell ™.

source https://www.readysteadysell.co.uk/can-i-sell-my-house-to-my-son-daughter-for-1/