When purchasing an investment property that is let to tenants, there is a whole host of additional information that you should have sight of in addition to what you would normally expect to see when buying your own home.
The additional information is in order to ensure that the property is safe to live in, and to ensure that the tenancy agreement(s) are in full force and effect.
You would expect the following documents to be provided as part of the sales process:
- Gas Safety Certificate – this certificate is issued by the gas engineer to confirm that the gas appliances are in satisfactory working order.
- Electrical Inspection Report – this report will be issued by the electrical engineer to confirm whether the electric systems and appliances are in good working order.
- Energy Performance Certificate – as of April 2018 it is a legal requirement that a property has a minimum energy rating of ‘E’ in order to be let.
- Evidence that the tenant’s deposit(s) have been placed in a tenancy deposit scheme. If the deposit is not protected by a tenancy deposit scheme you can be liable as a landlord to proceedings being brought for an amount up to £1,800 (which can be more if the tenancy was to roll over).
- Copies of the tenancy agreement.
- Details of any rental arrears and what will happen to them (will they be dealt with in the sale contract? If they are paid to you will there be a mechanism to pay them back to the seller? will the seller sell their right to assign the arrears claim over to you?)
- Rent authority letters. These letters will be addressed to the tenants from the seller, directing them to pay all future rent to you. Without these letters, the tenants may continue to pay their rent to the seller.
- An apportionment of rent paid or owed.
- A check that the tenancy is permitted use for the property.
These are just some of the additional things that may be relevant when buying a Buy To Let Property.
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