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Elderly parents

Am I the only one that thinks this is highly suspicious

81 replies

SSuspicioumum · 30/06/2024 21:37

Hi, so my mum is converting our home into individual flats. She is 65yrs old and she had a few builders come along to price up the works. She knows she won't be able to get a big loan at her age, but wont listen to reason. One builder that she is really drawn to, has offered not to accept payment and pay himself from the rent once the flats are occupied when he finishes building the works. Am I the only one that thinks this is highly suspicious even with a contract in place? Who works for free in this day and age.

OP posts:
AlohaRose · 01/07/2024 02:00

This sounds bonkers. How is your mum going to generate extra income if the builder needs to be repaid from the rentals? How much are the works going to cost and over how many years will the builder be repaid? Presumably your mum also needs to live in one of these flats so is that going to be rent free? And how on earth is she going to not only generate income and repay the builder but also allow for all the costs associated with changing tenancies, inventory checks, Routine maintenance, fallow periods between letting etc etc. there will also be tax payments due to HMRC. If the builder takes whatever is left over after all of the above the loan is never going to be paid off in her lifetime! Presumably there will also be some kind of interest costs due to him?

DogInATent · 01/07/2024 00:10

Well... for a few years your mum going to have a lot less (or possibly none at all) of the income from the flats she's expecting as the debt and interest is paid off by the rental income going to the builder.

Has she worked out how long it's going to take to pay off the builder going this route?

And how is he going to pay himself off from the rent? - he's not proposing he charge it and collect it from the tenants directly is he?

How will she pay for routine maintenance, repairs and renewals with no/reduced rental income from the flats?

Thedayb4youcame · 01/07/2024 00:03

ZoomDoomZoom · 30/06/2024 23:42

The builder will probably take the rental income for a few months & then put pressure for the debt to be repaid ASAP. He'll know that your mum won't be able to afford to repay it. He will then suggest writing over the house to him as a way of repaying the debt. It's the oldest trick in the book and your mum has fallen for it.

Well this is it. The builder is effectively loaning the mum the money, and in doing so it all has to be drawn up legally - it's the builder who stands to lose, therefore it makes sense that he'd have to be the type to put pressure on the mum if she fails to pay up.

leeverarch · 30/06/2024 23:51

ZoomDoomZoom · 30/06/2024 23:42

The builder will probably take the rental income for a few months & then put pressure for the debt to be repaid ASAP. He'll know that your mum won't be able to afford to repay it. He will then suggest writing over the house to him as a way of repaying the debt. It's the oldest trick in the book and your mum has fallen for it.

Yep.

Your mother needs to take some serious legal advice, especially if she is signing over the rights to any rental income, or giving him a charge over the property if she is unable to pay. What interest will he be charging her on the debt she owes him?

Where is she going to live?

allthemiddlechildrenoftheworld · 30/06/2024 23:47

@SSuspicioumum your mum is crazy!!! in my area, people are now trying to buy the flats above and below and convert back into proper family homes again. 4 bedroomed house will make awfully small flats!! can she not just buy a couple of flats outright rather than going through this rigmarole?? I am 69 now and I couldnt imagine living in that mess for the long time it is going to take. bad enough just getting an ensuite remodelled!!

OlderGlaswegianLivingInDevon · 30/06/2024 23:44

Is your mother planning on living in one of the ' new ' flats, will she have to pay rent too ?
i.e. is the builder expecting rent from all 4 ? flats for 1, 2, 3 or more years until his bill is paid ?

What happens if your mother dies before the builder is fully paid ?

ZoomDoomZoom · 30/06/2024 23:42

The builder will probably take the rental income for a few months & then put pressure for the debt to be repaid ASAP. He'll know that your mum won't be able to afford to repay it. He will then suggest writing over the house to him as a way of repaying the debt. It's the oldest trick in the book and your mum has fallen for it.

ZoomDoomZoom · 30/06/2024 23:35

SSuspicioumum · 30/06/2024 23:03

Totally. Even with a contract. What's in it for the builder?

He's got a claim on the house, he will probably put a charge on it which means he has a legal interest in it. He will need to be repaid before it is sold.

Take your mum to see a property solicitor to explain the consequences of this arrangement. Just book the appointment, don't twll her until you get to the appointment. It'll be the best £x you will have ever the spent.

Mosaic123 · 30/06/2024 23:24

Doesn't sound like there will be enough space for that many flats unless there is a huge extension? I'm just guessing though.

SSuspicioumum · 30/06/2024 23:12

PermanentTemporary · 30/06/2024 21:56

Could the builder end up with some sort of claim on the house? She needs her own legal advice

Hopefully not. If she doesn't listen and goes ahead with the works, we will have to make sure this is not the case.

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SSuspicioumum · 30/06/2024 23:10

LakeTiticaca · 30/06/2024 22:09

No way. This is all kinds of wrong.
Your mum needs to tell him it's not happening. Why does she want to convert into flats?

Yep. Totally agree with you. She wants to get extra income from them. Like a retirement plan

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Doingmybest12 · 30/06/2024 23:08

So is he effectively saying he'll loan the cost of the work to be paid once the tenants are paying rent? I don't think it's completely bonkers, if he has the finance, the work suits him and it gets done in good time and its all agreed what is owed. You'd need some references though I think. What's in it for him is he gets a good amount of work.

SSuspicioumum · 30/06/2024 23:08

OlderGlaswegianLivingInDevon · 30/06/2024 22:52

Is the builder receiving ownership of one of the flats in return for payment of his services ?
How many flats is Mum turning the ' home ' into ? 2 or more.
Is she then selling them ?
or renting them ?

SSuspicioumum · Today 23:01
So it's a 4 bedroom home and she wants to turn them into 3-4 1 bed flats/bedsits for rent. The builders say they will only take money from rent until the money owed is paid. Doesn't make sense to me at all, but mum is convinced this will work. As she doesn't have to take out a loan.

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SSuspicioumum · 30/06/2024 23:07

Bearpawk · 30/06/2024 22:01

No fucking way. Do not let this happen.

Totally. Even with a contract. What's in it for the builder?

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OlderGlaswegianLivingInDevon · 30/06/2024 23:07

'she wants to turn them into 3-4 1 bed flats/bedsits '

will that work, have you seen the plans, did an architect draw them up ?
and did she gain planning permission ?

all of this costs money - does she have that ?

SSuspicioumum · 30/06/2024 23:06

BasilParsley · 30/06/2024 21:58

This... This is the most important point at this stage...

Yes she has.

OP posts:
SSuspicioumum · 30/06/2024 23:03

Totally. Even with a contract. What's in it for the builder?

OP posts:
SSuspicioumum · 30/06/2024 23:01

So it's a 4 bedroom home and she wants to turn them into 3-4 1 bed flats/bedsits for rent. The builders say they will only take money from rent until the money owed is paid. Doesn't make sense to me at all, but mum is convinced this will work. As she doesn't have to take out a loan.

OP posts:
Confusedbythistreat · 30/06/2024 22:59

Omg that sounds highly stressful at half her age

SSuspicioumum · 30/06/2024 22:59

Yep. Totally agree with you. She wants to get extra income from them. Like a retirement plan

OP posts:
SSuspicioumum · 30/06/2024 22:58

I have tried talking her out of it. But she won't listen.

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SSuspicioumum · 30/06/2024 22:57

She has planning permission

OP posts:
OlderGlaswegianLivingInDevon · 30/06/2024 22:52

Is the builder receiving ownership of one of the flats in return for payment of his services ?
How many flats is Mum turning the ' home ' into ? 2 or more.
Is she then selling them ?
or renting them ?

LakeTiticaca · 30/06/2024 22:09

No way. This is all kinds of wrong.
Your mum needs to tell him it's not happening. Why does she want to convert into flats?