BTL mortage question
Discussion
Would appreciate some thoughts from any experts on here. Here's the scenario - BTL property currently in my name with no mortgage on it, I am currently transferring this into wife's name as more tax efficient. If I do this,(i.e. sole title is my wife, not joint) could we raise a mortgage against the property ? My wife is not employed, hence the ability to get a mortgage would be based on the rental income, or me as guarantor I assume. Rough values - property £170k, mortgage sort £70k, so low LTV.
Kudos - my information says you only pay stamp duty if a 'consideration' take splace i.e. actual money changes hands or a mortage is involved. In a transfer between two people, where neither is involved, there's no stamp duty to pay. I've taken this from the HMRC site and having done this before, we never previously incurred SD.
You're right if someone is taking on a portion of a mortgage and that value is above SD thresholds.
You're right if someone is taking on a portion of a mortgage and that value is above SD thresholds.
WindsorRob said:
Kudos - my information says you only pay stamp duty if a 'consideration' take splace i.e. actual money changes hands or a mortage is involved. In a transfer between two people, where neither is involved, there's no stamp duty to pay. I've taken this from the HMRC site and having done this before, we never previously incurred SD.
You're right if someone is taking on a portion of a mortgage and that value is above SD thresholds.
I'm happy to stand corrected. Advice was given to me by a solicitor when I did something similar a few years ago, albeit property was under stamp duty thresholdYou're right if someone is taking on a portion of a mortgage and that value is above SD thresholds.
WindsorRob said:
Would appreciate some thoughts from any experts on here. Here's the scenario - BTL property currently in my name with no mortgage on it, I am currently transferring this into wife's name as more tax efficient. If I do this,(i.e. sole title is my wife, not joint) could we raise a mortgage against the property ? My wife is not employed, hence the ability to get a mortgage would be based on the rental income, or me as guarantor I assume. Rough values - property £170k, mortgage sort £70k, so low LTV.
It's not obvious to me where this proposal "makes money".You could just sell the btl and give your wife £100k to invest in the stock market etc.
Claudia Skies said:
WindsorRob said:
Would appreciate some thoughts from any experts on here. Here's the scenario - BTL property currently in my name with no mortgage on it, I am currently transferring this into wife's name as more tax efficient. If I do this,(i.e. sole title is my wife, not joint) could we raise a mortgage against the property ? My wife is not employed, hence the ability to get a mortgage would be based on the rental income, or me as guarantor I assume. Rough values - property £170k, mortgage sort £70k, so low LTV.
It's not obvious to me where this proposal "makes money".You could just sell the btl and give your wife £100k to invest in the stock market etc.
Willhire89 said:
Maybe 'wife' not using her personal allowance and this would make income from rent more tax efficient
Yes, I understand that. What I'm querying is essentially why you think that the buy-to-let is the right investment choice. It is one of the possibilities open to you, of course.What I particularly noticed is that you seem to want £100k of cash out to do something else with. I realise the mortgage interest is tax-deductible but if that was your motivation I'd expect you to have a mortgage in your own name in the first place. Personally I've never been a fan of borrowing money I've already got.
It may well be that your original suggestion is the right thing for you/her. Just make sure you've both thought through all the alternatives as well.
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