'Benefits to be had' by renting out a room

Posted: 02 Sep 2011 11:51:40 GMT

Those who rent a room out for five years could knock 29 months off their offset mortgage.

There are many benefits to be had for homeowners who choose to rent out a room, it has been suggested.

New research from First Direct noted a person who gives up such a space to a tenant for five years could shave 29 months off their offset mortgage.

The organisation said now is the ideal time for people with an offset mortgage to rent out rooms, with students set to return to university and house prices remaining too expensive for many would-be buyers.

Richard Tolchard, senior mortgage product manager at First Direct - a division of HSBC Bank - said: "As long as all necessary precautions have been taken, having a lodger is a really easy way for homeowners to earn more cash and reduce the term of their mortgage."

It was calculated that making use of monthly rent to make mortgage overpayments could save a homeowner more than £1,000 in interest in half a decade.
 

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