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TheCountOfNowhere

The greatest thread of all...The BTL running for the exit thread

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2 hours ago, Lavalas said:

It will be by Paul Barratt. Unremarkable statement for him to be honest. Some of the posters on Property Tribes understand that the game is up and there’s pretty much zero campaigning across the boards now, but even I know there’s a million things better to be doing than reading any of PB’s extended tripe.

Paul is quite a 'character'. IIRC he's been handed a temporary ban by the PovertyTribe moderators on at least one occasion. To be fair he's been much more realistic about the consequences of Section 24 and PRA SS13/16 from the outset than some of the other PT posters and the point that he's making is one that we've made repeatedly - a really canny portfolio leveraged landlord who felt that their bet was about to sour would just keep their mouth shut and start selling up.

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1 hour ago, Freki said:

10% net return ? Damn give me a slice of this pie... I work in emerging markets and my company issued bonds under 10%, with all the risks associated ...

Maybe better to be in emerging rather than dying markets. 

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1 hour ago, Beary McBearface said:

Paul is quite a 'character'. IIRC he's been handed a temporary ban by the PovertyTribe moderators on at least one occasion. To be fair he's been much more realistic about the consequences of Section 24 and PRA SS13/16 from the outset than some of the other PT posters and the point that he's making is one that we've made repeatedly - a really canny portfolio leveraged landlord who felt that their bet was about to sour would just keep their mouth shut and start selling up.

Yeah, you're right actually. He is one of the more realistic ones. He doesn't give away specifics but he has openly stated that he's utterly stuffed by S24 and there's nothing he can do. I don't suppose it would take many guesses to work out why and it is this fact that probably leads to some of his more outlandish ideas.

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1 hour ago, Beary McBearface said:

a really canny portfolio leveraged landlord who felt that their bet was about to sour would just keep their mouth shut and start selling up.

i sold a car once that needed a new engine but did run so appeared to be working well .

hardly canny is it , fool looking for a bigger one. 

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12 hours ago, Option5 said:

Page 3 dated 10 Oct at 07:58

Thanks. D'oh. I had no idea there was more than one page! shitty design of that website. Yes it's Paul Barrett, you'd think with his surname he would have realised what to do when we did, 2 and a half years ago (sell now, sell everything) instead of only just now.

 

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So those who are going to be bankrupt, what actually happens? 

They just fill in a form and everything that’s left gets split up around the creditors? banks get the houses back, but loose all their calculated profit? They sell cheap to shift the stock as a repossession? 

if the person knows he’s going bust, just he declare it now? Or wait until the unplayable tax bills come?

HRMC gets first dibs, but do they? Banks have first charge on the houses? 

the debtor looses everything if there’s negative equity? Own home? future earnings?

we know many are going bust. But what would this process and stresses look like in a blow by blow account? 

how long will it take the bank to put the repossessions on the market? would they all get the houses on the market ASAP? Or would they drip feed onto the market.

i would imagine a small market town suddenly getting a 30 house portfolio dumped would crush market values pretty quickly 

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8 minutes ago, jiltedjen said:

So those who are going to be bankrupt, what actually happens? 

They just fill in a form and everything that’s left gets split up around the creditors? banks get the houses back, but loose all their calculated profit? They sell cheap to shift the stock as a repossession? 

if the person knows he’s going bust, just he declare it now? Or wait until the unplayable tax bills come?

HRMC gets first dibs, but do they? Banks have first charge on the houses? 

the debtor looses everything if there’s negative equity? Own home? future earnings?

we know many are going bust. But what would this process and stresses look like in a blow by blow account? 

how long will it take the bank to put the repossessions on the market? would they all get the houses on the market ASAP? Or would they drip feed onto the market.

i would imagine a small market town suddenly getting a 30 house portfolio dumped would crush market values pretty quickly 

On one of the threads on PT there was some insinuation that the way to handle bankruptcy is to hide assets before you go bankrupt, which seems a little dodgy/stupid, especially when the poster in question is posting under what is presumably a real name...

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Here it is: 

https://www.propertytribes.com/scary-stuff-underwater-with-mx-t-127631530-6.html

"paul_barrett to PropertyGuy 24 Oct at 07:17
 

My crystal ball works quite well

I knew 20 years before it was required that I would need to sell my PPR

I certainly  did hide assets away

Still waiting  imprisonment!!

You are typical of those that think conventionally

You have to game the system to survive.

Only a fool would fess up to all their assets to pay creditors.

Which is why for 20 years I haven't!

This LL  needs to get into the gaming mentality to avoid being stripped of his assets

All talk of imprisonment  etc is just plain stupid.

Creditors don't waste their time or money pursuing pointless recovery action and certainly have no interest in pursuing custodial sentences for their defaulting borrowers!!

Make yourself plausibly assetless and they will leave you alone.

I planned some of mine 20 years before I knew it would need to happen.

It really  isn't that hard to work out.

You just have keep juggling until you determine  the game is over and then exit stage left

Which is exact what I did.

This LL  should be planning similar."

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Yeah. Right.

Unless hes been paying cash for anything than he can forget all his dumb advise.

He's not going to hide a house or anything.

 

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It will be interesting to see how HMRC and the banks deal with rooting out BTL landlords.

I’ll be monitoring my work colleague’s recent BTL venture as a ‘case in point’ example. He has  re-mortgaged his own house (bought in the 80s)  to buy another property that he has had renovated and now rents out for £1600p/m.

He actually got the re-mortgage as he stated to the bank that the property was for his daughters, so its on a residential mortgage. He has since registered as a landlord, as he is using a letting agent (and Croydon requires landlord registration) and he also wanted a drop kerb so had to apply through the council.

Whenever the records are compared, I suspect he’ll get a fine/backpay by the bank for getting a residential mortgage and not disclosing as a BTL. I then suspect HMRC will be after his tax return, as the rental income will most certainly push him into a higher tax bracket. I have tried to explain all this to him, but he doesn’t really care (or understands). He has also got a brand new car on finance (as he now fancies himself as a bit of a property developer) to add to his debt pile.

Question is, how many BTL landlords must be in the exact same boat and how quickly can we expect the HMRC/banks to start turning the screws?

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38 minutes ago, sideysid said:

It will be interesting to see how HMRC and the banks deal with rooting out BTL landlords.

I’ll be monitoring my work colleague’s recent BTL venture as a ‘case in point’ example. He has  re-mortgaged his own house (bought in the 80s)  to buy another property that he has had renovated and now rents out for £1600p/m.

He actually got the re-mortgage as he stated to the bank that the property was for his daughters, so its on a residential mortgage. He has since registered as a landlord, as he is using a letting agent (and Croydon requires landlord registration) and he also wanted a drop kerb so had to apply through the council.

Whenever the records are compared, I suspect he’ll get a fine/backpay by the bank for getting a residential mortgage and not disclosing as a BTL. I then suspect HMRC will be after his tax return, as the rental income will most certainly push him into a higher tax bracket. I have tried to explain all this to him, but he doesn’t really care (or understands). He has also got a brand new car on finance (as he now fancies himself as a bit of a property developer) to add to his debt pile.

Question is, how many BTL landlords must be in the exact same boat and how quickly can we expect the HMRC/banks to start turning the screws?

Keep us updated on this shyster

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i think there is going to a heck of a lot of tax collected over the next few years. Both in out-right tax, and also the kind of:

'hang on, whats going on here? he never paid tax before, this cant be right, i suppose we better investigate' back-dated tax.

its starting to be the end of the road. The banks will wake up pretty sharpish as soon as people start to default due to bills to the HRMC. They never lent expecting that to happen.

The need for money will suddenly force the banks to actually ask questions, and the risk profiles are going to hell in a hand-basket. 

BTL is going to get badly badly crushed over the coming years. Most BTL are very very dim, thankfully the answer for most will be 'oh sod this, i will flog up, i cant be bothered anymore'

which is exactly what we want. 

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4 hours ago, sideysid said:

Whenever the records are compared, I suspect he’ll get a fine/backpay by the bank for getting a residential mortgage and not disclosing as a BTL. I then suspect HMRC will be after his tax return, as the rental income will most certainly push him into a higher tax bracket. I have tried to explain all this to him, but he doesn’t really care (or understands). He has also got a brand new car on finance (as he now fancies himself as a bit of a property developer) to add to his debt pile.

Question is, how many BTL landlords must be in the exact same boat and how quickly can we expect the HMRC/banks to start turning the screws?

A fine would be pathetic. Why can't he go to prison for committing fraud? You can't hide a house. There won't be any escaping what he's done.

Yes, please do keep us updated. :)

 

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30 minutes ago, mrtickle said:

A fine would be pathetic. Why can't he go to prison for committing fraud? You can't hide a house. There won't be any escaping what he's done.

Yes, please do keep us updated. :)

 

I remember seeing a claim that there are over 250k BTL's with residential mortgages. Truth is the banks don't care, as long as he keeps paying the mortgage, so the chances of a fine or any other action is minimal.

On the other hand if he is not filing a self assessment it's only a matter of time before the he gets a letter from the HMRC, Assuming he has registered a deposit they will already have been sent his details. If not, they still have access to his details via the letting agent.

     

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1 hour ago, mrtickle said:

A fine would be pathetic. Why can't he go to prison for committing fraud? You can't hide a house. There won't be any escaping what he's done.

Yes, please do keep us updated. :)

 

Hefty fines are best IMO.  Prison costs the taxpayer a bomb. 

A suspended sentence plus fine is probably even better - into the slammer if you don't pay up. 

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32 minutes ago, Mrs Bear said:

Hefty fines are best IMO.  Prison costs the taxpayer a bomb. 

A suspended sentence plus fine is probably even better - into the slammer if you don't pay up. 

I have a great deal of experience in sentences, CPS and court process in general. You would have to be a landlord on grand scale knowingly committing fraud to receive any custodial sentence. It will be fines and back payments all the way. I am also sceptical that the HMRC will have the resources to investigate every suspected landlord that doesn't declare themselves.

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1 hour ago, sideysid said:

I have a great deal of experience in sentences, CPS and court process in general. You would have to be a landlord on grand scale knowingly committing fraud to receive any custodial sentence. It will be fines and back payments all the way. I am also sceptical that the HMRC will have the resources to investigate every suspected landlord that doesn't declare themselves.

And very few criminal records as well. I think for most, the threat of a criminal record would be enough to make them fall into line, but instead HMRC issues penalties which are civil. 

As a result, there is still a fair incentive to evade tax if you think the chances of getting caught are small, which they previously were. 

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5 hours ago, Confusion of VIs said:

I remember seeing a claim that there are over 250k BTL's with residential mortgages. Truth is the banks don't care, as long as he keeps paying the mortgage, so the chances of a fine or any other action is minimal.

On the other hand if he is not filing a self assessment it's only a matter of time before the he gets a letter from the HMRC, Assuming he has registered a deposit they will already have been sent his details. If not, they still have access to his details via the letting agent.

     

They should care - because they should be getting far more if it was a commercial bridging loan instead of a residential mortgage!

Ok, yes. Give them all a big fine, obviously all the back-payments, AND criminal records all round.

Above - "have access to his details via the agent" - are not the only two choices. I'm sure there are a large number who don't register deposit, and don't use an agent. Combine that with a bank in collusion by turning a blind eye to the fraud, and no-one reporting them - and it's a large-scale abuse.

 

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48 minutes ago, mrtickle said:

They should care - because they should be getting far more if it was a commercial bridging loan instead of a residential mortgage!

Ok, yes. Give them all a big fine, obviously all the back-payments, AND criminal records all round.

Above - "have access to his details via the agent" - are not the only two choices. I'm sure there are a large number who don't register deposit, and don't use an agent. Combine that with a bank in collusion by turning a blind eye to the fraud, and no-one reporting them - and it's a large-scale abuse.

 

You might think that but the banks are offering BTL at not much more than residential. Their BTL lending is so generous I know a couple of people living houses they could only afford by getting BTL rather than residential loan.

I don't know for certain but surely HMRC must have access to details of everyone who has a BTL mortgage. 

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4 hours ago, sideysid said:

I have a great deal of experience in sentences, CPS and court process in general. You would have to be a landlord on grand scale knowingly committing fraud to receive any custodial sentence. It will be fines and back payments all the way. I am also sceptical that the HMRC will have the resources to investigate every suspected landlord that doesn't declare themselves.

HMRC doesn't need massive resources.

All they need to do to get started is sift the data and send a letter to people who appear to have a BTL but not submitting a tax return asking them to pop in and explain this apparent anomaly. Couple this with some strong messaging about last chance to come clean and avoid massive penalties or prosecution and I think most people would comply. 

 

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17 hours ago, Confusion of VIs said:

HMRC doesn't need massive resources.

All they need to do to get started is sift the data and send a letter to people who appear to have a BTL but not submitting a tax return asking them to pop in and explain this apparent anomaly. Couple this with some strong messaging about last chance to come clean and avoid massive penalties or prosecution and I think most people would comply. 

 

They've already done that amnesty - probably as part of a data checking exercise.

The next bit will be in April when letters are sent to people to remind them that they need to pay tax on their BTL income before interest. I suspect that letter will be a surprise to many people...

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16 minutes ago, Houdini said:

They've already done that amnesty - probably as part of a data checking exercise.

The next bit will be in April when letters are sent to people to remind them that they need to pay tax on their BTL income before interest. I suspect that letter will be a surprise to many people...

HMRC started their Let Property Campaign in Autumn 2013.

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17 hours ago, Confusion of VIs said:

You might think that but the banks are offering BTL at not much more than residential. Their BTL lending is so generous I know a couple of people living houses they could only afford by getting BTL rather than residential loan.

I don't know for certain but surely HMRC must have access to details of everyone who has a BTL mortgage. 

Banks? Nope.

Just a few idiot ex BS who do not have the sense to to work out whats coming.

Knacked, so just veging today.

I was having a look at what brought me to this site - holiday homes/lets.

Standard sunday paper personal finance article - How Mr and Mrs Middleclass are doing sooo well with their holiday let in Westcountry/lakedustruct/nym etc.

Then you look for the numver of banks offering holiday let finance - 2 small ex BS. 

No one seems to join the dots between the ' huge earnings' and lsck of finance providors.

BTL is like this but many orders of magnitude bigger.

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I was chatting to my landlord today (who is one of the rare non-scummy variety) and he was telling me that he's got some friends who are London landlords that are going to be ruined by section 24 and are planning to sell several properties each in the new year. Every second flat on Rightmove is already clearly a BTL and barely any are shifting so if this is a general awakening of landlords to their situation then it's going to be carnage come January.

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