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Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience:  Solicitor with 5+ years experience
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I own a 4 bedroom house with my friend currently still under

Resolved Question:

I own a 4 bedroom house with my friend currently still under mortgage. However, he has moved due to job elsewhere. So, I lodged the 3 empty rooms to 3 working professionals. Is this legally acceptable?
Submitted: 3 years ago.
Category: Law
Expert:  Ash replied 3 years ago.

Alex Watts : Hello my name is XXXXX XXXXX I will help you with this. Please note that I am a working Solicitor and may be on and offline as I have to attend Court and meet with clients, even at weekends. As such you may not get an instant response when you reply, but rest assured I will be giving your question my immediate attention upon return You do not need to wait here as you will get an email when I reply.
Alex Watts : Do you have any form of written agreement with your friend please?
Customer:

The house or mortgage is in 50:50 share between my friend and I. We both agree to lodge the empty rooms out so that it helps repaying the mortgage as well as other expenses. We don't have a written agreement stating we must lodge the empty room out. Our question are:Is it legally OK to lodge 3 empty rooms out? If not, what actions need to be taking?

Alex Watts :

Yes you can lodge with 3 people.

Alex Watts :

There is nothing you need to do as you are only renting out rooms.

Alex Watts :

For more information please see:

Alex Watts :

https://www.gov.uk/rent-room-in-your-home

Alex Watts :

If you earn over £4250 then you would have to pay tax on it

Alex Watts :

Can I clarify anything for you about this today please?

Customer:

By renting out room by room basis as such, does it mean my house become HMO? If yes, is there anything we must do?

Customer:

Also, what if I also move out in the future?

Alex Watts :

If they are 3 separate people not sharing then it will be a HMO

Alex Watts :

I had assumed that they would have shared.

Alex Watts :

But to be clear if they have 1 bedroom each it will be a HMO even if you live there

Alex Watts :

If you have 3 rooms and they are each let it will be a HMO and you will need a licence.

Alex Watts :

This is legally acceptable but you still need a licence from the local Council

Alex Watts :

Can I clarify anything for you about this today please?

Customer:

Each lodger occupier a bedroom and we share other areas in the house such as kitchen, bathroom, etc. Is this classified as HMO? My house type is a 2 story 4 bedroom link-detached. Do I need a HMO licence from the local council? What are the consequences if I don't have a HMO licence (or do nothing)? Finally, how do I avoid HMO (e.g., maximum 2 lodgers only)?

Alex Watts : Yes it's a HMO is defined
Alex Watts : A house in multiple occupation is a property rented out by at least 3 people who are not from the one ‘household’, eg a family, but share facilities like the bathroom and kitchen. It’s sometimes called a ‘house share’.
Alex Watts : If you meet this you can't get away from it, if you want to avoid it don't have 3
Alex Watts : You would need a HMO from the council, if you don't they can stop and prosecute HPI.
Alex Watts : prosecute you.
Alex Watts : Can I clarify anything for you about this today please?
Customer:

So if 2 unrelated lodgers stay with me. Each of them occupier a bedroom. I can do nothing and is totally legal.

Customer:

Right?

Customer:

Otherwise, I need to get a HMO licence from the local council.

Customer:

BTW, what is HPI and what is the max. penalty on the prosecute to me?

Alex Watts : Yes you are right if 2 unrelated stay you are fine.
Alex Watts : More than 2 you need a licence.
Alex Watts : Hpi was auto correct!
Alex Watts : A fine of up to £20,000
Alex Watts : Can I clarify anything else.
Customer:

What do I need to do to get a HMO licence? Do my mortgage lender allow that?

Alex Watts : You need to notify your lender yes.
Alex Watts : You need to fill in an application at the council.
Customer:


1. We checked on the Cambridge local council website (https://www.gov.uk/house-in-multiple-occupation-licence/south-cambridgeshire/apply), it states 5 tenants instead of 3 tenants as:



You must have a licence for your HMO if it’s:


- rented to 5 or more people who form more than 1 household


- at least 3 storeys high



We don’t meet these requirements. Please clarify.



2. If the bank notice we are letting 3 rooms out without HMO, what are they going to do? who is going to prosecute us, is it the bank, or the council?




3. If we reduce one tenant now, do you think the council will prosecute us?




4. How do we register HMO with the council? Our house is a 4 years old house, do you think we will have great difficulty to apply HMO?




5. How about two unrelated couples to share our house, do we need HMO? Or perhaps one couple and one single tenant, do we need HMO?

Alex Watts :

Each Council has their own requirements.

Alex Watts :

https://www.gov.uk/house-in-multiple-occupation-licence

Alex Watts :

1. If that is the case you don't need a HMO

Alex Watts :

2. I don't think it makes a difference if you have LESS than 5 people there

Alex Watts :

3. No I do not

Alex Watts :

4. You need to apply for a licence.

Alex Watts :

5. No

Alex Watts :

Can I clarify anything for you?

Customer:

So after all, my current situation (3 separate lodgers living with me in a 2 storeys 4 bedrooms linked detach house) is totally legal and I don't need to do anything. Right?

Alex Watts :

Correct

Alex Watts :

If this answers your question could I invite you leave feedback on my service which I hope has been excellent today, if you need more information or help then please click reply.


Please remember that I am always happy to help if you have future questions, even if I am in Court I can normally respond within a few hours. For future information, please start them with ‘For Alex W’.


 


Please bookmark my profile if you wish for future help: http://www.justanswer.co.uk/law/expert-alexwatts/

Customer:

Good.



How about if I move out?


Can I still rent the house to the 3 existing tenants plus 1 new tenant who take my room?


What do I need to do differently or additionally?

Alex Watts : You can as long as you don't make it a HMP.
Alex Watts : Hmo
Alex Watts : Make sure you do not fit HMO and you will be fine.
Alex Watts : Please remember to leave feedback before you go today.
Customer:

OK. Thank you for your helps.

Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience: Solicitor with 5+ years experience
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