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Halifax consent lease - Huge hike and arrangement fee!
Billington
Posts: 10 Forumite
Ok I'm really shocked by Halifax. Basically my wife and I own our 2 bedroom house in Brighton and want to rent it out and rent a flat in London as we need to move for work. We currently have a 2 year £200,000 tracker mortgage running for another 20 months at around 1.6% above the base rate meaning we are paying around £350 month in interest and another £450 into the capital.
We called them to check about getting their consent to let it and they asked us to come into the branch. They then informed us that if we let the property we would have to go on their most expensive 'consent to lease 'mortgage as our LTV is 79% which is fixed for 3 years at 5.4% and has an arrangement fee of around £1,250. This would mean our interest only payment would be just over £900/month without even paying into the capital. We reckon we could get £1200 in rental but this seems way excessive compared to what we are paying now. She said we had no other option other than get a buy to let mortgage with another company which would mean we'd pay redemption fees of £6000!
Do we have any other option than take up their new mortgage? Seems extortionate to me.
We called them to check about getting their consent to let it and they asked us to come into the branch. They then informed us that if we let the property we would have to go on their most expensive 'consent to lease 'mortgage as our LTV is 79% which is fixed for 3 years at 5.4% and has an arrangement fee of around £1,250. This would mean our interest only payment would be just over £900/month without even paying into the capital. We reckon we could get £1200 in rental but this seems way excessive compared to what we are paying now. She said we had no other option other than get a buy to let mortgage with another company which would mean we'd pay redemption fees of £6000!
Do we have any other option than take up their new mortgage? Seems extortionate to me.
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Comments
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Bump! Anyone?0
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Did you ask what LTV would get you a better deal? Did you ask under what conditions you could get consent to let and remain on your current mortgage? Just wondering if you could pay a lump sum off if it would help.0
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Looks like the branch is trying to get you to transfer to a buy-to-let mortgage. Whereas you want consent to lease on a temporary basis on your initial mortgage. Makes you wonder if the branch has targets to meet.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0
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More likely they want you off that low tracker rate. Try asking on the mortgages board, see if there is a way to keep the tracker.
I would not let without consent though.0 -
Did they ask to see a business plan for the business you're planning on running?0
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Have you factored in tax on the additional income?Declutterbug-in-progress.⭐️⭐️⭐️ ⭐️⭐️0
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Have you factored in tax on the additional income?
With a mortgage costing £900 per month, I doubt they'll be much profit to tax.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
Thanks for replies. All the mortgage interest is claimable against tax so means they're would be little or no profit with their offer. It would also mean going interest only for 3 years. The other thing to mention is I only went on my current tracker deal in April for which they charged £900 fee so would mean paying another huge fee again.0
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With all the extra money Halifax want, surely it would be cheaper to either commute, or rent a tiny bedsit that you can stay in during the week, then come home at weekends.
Normally the cheaper rate will be at 75% LTV, so you're just below this... Do you have any spare cash to increase the equity?
Why not phone Halifax and speak to someone different? See if you get the same answer? Sounds like Halifax being greedy to me!Should've = Should HAVE (not 'of')
Would've = Would HAVE (not 'of')
No, I am not perfect, but yes I do judge people on their use of basic English language. If you didn't know the above, then learn it! (If English is your second language, then you are forgiven!)0
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