2 buy to let flats

[GlobalC]

Hi Guys,

Just been mulling over my debt issues that are listed in other threads. One of my biggest fears is losing the 2 buy to let flats that I have in my name. The reason for this is because they essentially are not mine. Family had lent me the money to convert a house into 2 flats before the market crashed. Myself and a friend both put 30k each into the project once finished the market had collapsed and as the friend had a ccj I took out 2 BTL's before my financial woes started. What I would like to know is whether or not I could assign these over to my family as its their money really or what the chances are of me selling them to them for no profit while they get new BTL's. How would this look considering some of my creditors are already rubbing their hands realising I have these in my name?

[Deepie]

Re: 2 buy to let flats

planB AAD Housing Expert


planB is the one to ask......

[PlanB]

Re: 2 buy to let flats

What I would like to know is whether or not I could assign these over to my family as its their money really or what the chances are of me selling them to them for no profit while they get new BTL's. How would this look considering some of my creditors are already rubbing their hands realising I have these in my name?

Who is the lender? Some are more 'flexible' than others with assignments.

Are you looking for an outright sale to a family member or the possibility of adding a family member to the current mortgage/deeds?

You have every right to sell your properties to whomever you want for whatever price you want as long as the sale clears the mortgage on the property. The agreed sale price won't frustrate the sale. But that happy situation may differ if there is a charging order in place or any legal action pending at the time of the agreed purchase.

Have you considered whether the sale of one of these two Buy-To-Let properties may be sufficient to satisfy the bank's demands? I've followed your other threads

[PlanB]

Re: 2 buy to let flats

they essentially are not mine. Family had lent me the money to convert a house into 2 flats before the market crashed. Myself and a friend both put 30k each into the project

You will also need to consider the Capital Gains Tax position. This is complicated. You (and three others?) bought the original property as a single dwelling. Then it changed into two separate dwellings. Then you plan to sell them both at a profit (or not). CGT will be relevant. But who should pay this? The family members who invested in the property? Or you and your business partner?

[GlobalC]

Re: 2 buy to let flats

Who is the lender? Some are more 'flexible' than others with assignments.

Are you looking for an outright sale to a family member or the possibility of adding a family member to the current mortgage/deeds?

You have every right to sell your properties to whomever you want for whatever price you want as long as the sale clears the mortgage on the property. The agreed sale price won't frustrate the sale. But that happy situation may differ if there is a charging order in place or any legal action pending at the time of the agreed purchase.

Have you considered whether the sale of one of these two Buy-To-Let properties may be sufficient to satisfy the bank's demands? I've followed your other threads

Hi Plan B thanks for responding wasnt able to log on for most of today. The lender is birmingham midshires. What I want is to protect my family's investment along with the other business partner. Ideally i would like to assign over or sell the flats whatever works to my mother so the bank arent able to put a CO on them if they get one on my house then fair enough! My mother is in her 60's so unsure about whether she could get a mortgage anyways

[GlobalC]

Re: 2 buy to let flats

You will also need to consider the Capital Gains Tax position. This is complicated. You (and three others?) bought the original property as a single dwelling. Then it changed into two separate dwellings. Then you plan to sell them both at a profit (or not). CGT will be relevant. But who should pay this? The family members who invested in the property? Or you and your business partner?

This is a very good point, I would say that I would have to pay it but would there be anything to pay if i sold for the price i bought them for? would it just be easier if I could somehow get my mothers name on the current mortgage?

[SXGuy]

Re: 2 buy to let flats

CGT is chargeable on the difference between purchase price and sale price, so no CGT if sold for same amount.

[PlanB]

Re: 2 buy to let flats

CGT is chargeable on the difference between purchase price and sale price, so no CGT if sold for same amount.

And if sold at a loss CGT can be rolled-over can't it

It's not just the difference between purchase price and sold price, the OP can factor the development/building costs into the equation, plus all the legal costs and planning application fees etc. And if the family members who lent him the money to purchase the property have charged interest on that *loan* then that maybe offset against tax too. Lots of options but good professional advice would be worth it's weight in gold since it's a complicated situation involving two business partners and one property divided into two properties.

[SXGuy]

Re: 2 buy to let flats

Correct Plan B, loads of factors to consider, CGT is quite a headache for most accountants because in envolves a lot of factors taken in to consideration to get the end result. Its def worth seeking a professional and getting it sorted.