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  • FIRST POST
    karenbarnett
    Converting residential mortgage to Buy-to-Let
    • #1
    • 28th Mar 11, 5:58 PM
    Converting residential mortgage to Buy-to-Let 28th Mar 11 at 5:58 PM
    Please help!
    My husband and I are emigrating, and want to let out our flat rather than sell in this market.

    When calling our existing lender (Halifax) we were told that, as we had come off our fixed rate and were now on the variable, we'd need to convert to a Buy-to-Let rate and provided quotations.
    I've also looked elsewhere for a better option (through a broker) - the best being with The Mortgage Works - but the fees that go along with this are astronomical...

    I'm not just talking about the 2.5% arrangement fee, but the Valuation fee at £390, plus conveyancing fees (I've been quoted £499).

    Is it just me, or are these fees ridiculous? I'd always thought a valuation was £150...
    Are there other 'hidden' fees that I dont know about? What have other people paid?

    Any advice anyone can give me would be amazing.

    Thanks
Page 1
  • storn
    • #2
    • 28th Mar 11, 6:05 PM
    • #2
    • 28th Mar 11, 6:05 PM
    Times have changed I am afraid, nowadays is far more expensive......On my residential mortgage I had to pay £380 and also there will be over £1000 added to mortgage and £180 arrangement fee. Therefore I am not surprised that want much more for a btl.
  • gingertips
    • #3
    • 28th Mar 11, 6:47 PM
    • #3
    • 28th Mar 11, 6:47 PM
    its the way of the world...banks found a way to screw you over with additional fees that you used to consider part of the mortgage...the £499 is a joke - i would ask for written confirmation of who exactly is performing it & that you get a full copy of it...youre paying for it.
    • neverdespairgirl
    • By neverdespairgirl 29th Mar 11, 8:14 AM
    • 16,076 Posts
    • 71,580 Thanks
    neverdespairgirl
    • #4
    • 29th Mar 11, 8:14 AM
    • #4
    • 29th Mar 11, 8:14 AM
    Lloyds, I notice, have a valuation fee of £700-odd quid and a full survey fee of £2,500! For our type of property, anyway
    • angrypirate
    • By angrypirate 29th Mar 11, 9:57 AM
    • 1,125 Posts
    • 2,516 Thanks
    angrypirate
    • #5
    • 29th Mar 11, 9:57 AM
    • #5
    • 29th Mar 11, 9:57 AM
    Thats before you start to talk of void periods, repairs, tenants who dont pay rent, useless estate agents etc etc.
  • karenbarnett
    • #6
    • 29th Mar 11, 4:24 PM
    • #6
    • 29th Mar 11, 4:24 PM
    It's a sad state of affairs when the lenders penalise us for low interest rates. Not getting enough from the interest so they charge us ridiculous fees where possible.

    angrypirate, it's not an option to sell, as we'd lose a substantial amount of the capital we put in (our property being worth less than it was when we bought) so we're just going to have to risk the other things. Sounds like you've had a bad experience - my mum and best friends are landlords and have never experienced those things (well, except repairs but those would happen even if you were living there)
    • GuidoT
    • By GuidoT 29th Mar 11, 4:42 PM
    • 195 Posts
    • 91 Thanks
    GuidoT
    • #7
    • 29th Mar 11, 4:42 PM
    • #7
    • 29th Mar 11, 4:42 PM
    Lenders do not like to BTL much and those that do now charge large arrangement fees and high rates.

    I had one lender who wanted to charge me £3K in arrangement fees (on a £140K mortgage) with a rubbish rate.

    I remember 5 or so years ago when C&G did not differentiate between BTL and normal residential mortgages for the purpose of fees and rates (but they would only let you have one BTL), I still have that one on a SVR of I think 2.5%.
    Last edited by GuidoT; 29-03-2011 at 4:44 PM.
  • Brb
    • #8
    • 29th Mar 11, 4:45 PM
    • #8
    • 29th Mar 11, 4:45 PM
    Also ensure you have your tax position sorted before you go. Google non resident landlord. You may be able to get yourself exempt but has to be done before you emigrate/rent out property.

    There are other expenses too. Gas safety check, epc etc. Ensure you get a good LA as a bad one could (worst case scenario) see you in prison.
    Inside this body lays one of a skinny woman
    but I can usually shut her up with chocolate!

    When I thank a post in a thread I've not posted in,
    it means that I agree with that post and have nothing further to add.
  • karenbarnett
    • #9
    • 29th Mar 11, 5:08 PM
    • #9
    • 29th Mar 11, 5:08 PM
    Also ensure you have your tax position sorted before you go. Google non resident landlord. You may be able to get yourself exempt but has to be done before you emigrate/rent out property.

    There are other expenses too. Gas safety check, epc etc. Ensure you get a good LA as a bad one could (worst case scenario) see you in prison.
    Originally posted by Brb
    Thanks, we have taken all of these things into conideration. My mum, a landlord herself, will be looking after it, so saving us that issue which is good!

    Have just called our existing lender again about changing our existing mortgage to consent to let - the rate isnt as good as BTLs elsewhere but they said I can extend the term to keep repayments down. No valuations, no conveyancing/legal fees. This may be the way we go... what a total mindfield!
  • Brb
    Don't lose sight of why you're doing it though fulfilling a long dreamt dream living in a far flung land ... ?
    Inside this body lays one of a skinny woman
    but I can usually shut her up with chocolate!

    When I thank a post in a thread I've not posted in,
    it means that I agree with that post and have nothing further to add.
  • Gilea22
    Halifax
    I went to the Halifax and said I would be renting out my house after 7 years as a residential owner and they said I had to remortgage and the costs were over £1k for each offer they gave me plus it was 3 point above my present mortgage. It was said on a take it or leave it basis as I explained I would be paying more monies than I did on my present mortgage over and above the rent and insurance I would be taking out.
    Other lenders are not so good and I agree "The Mortgage Works" offer does seem to be the best on a remortgage but again your fees which could be added to the mortgage are very high.
    The banks borrow at a ridiculously small interest rate and then screw their clients espicially as the government own a huge share of the Halifax!!
    Anybody got any good ideas
    • de1amo
    • By de1amo 17th Apr 12, 3:00 PM
    • 3,280 Posts
    • 10,921 Thanks
    de1amo
    even if you are expat you have to pay tax on rent as normal-its business income.
    --if your out of the country you lose your tax number which stops any allowance as well.
    mfw'11 No68- 55k mortgage İO--little to nothing saved! i must do better.
    • jee
    • By jee 17th Apr 12, 3:04 PM
    • 272 Posts
    • 143 Thanks
    jee
    Halifax consent to let rates are a rip off. I'm remortgaging, from residential to buy to let, with Natwest. Free valuation and legal work. BUT my borrowing ratio is 75:25.
  • Notmyrealname
    I'm not just talking about the 2.5% arrangement fee, but the Valuation fee at £390, plus conveyancing fees (I've been quoted £499).

    Is it just me, or are these fees ridiculous? I'd always thought a valuation was £150...
    Are there other 'hidden' fees that I dont know about? What have other people paid?

    Any advice anyone can give me would be amazing.

    Thanks
    Originally posted by karenbarnett
    When I got a LTB mortgage 2 years ago, the fees were about £2k all in.

    Its a business. What you pay in fees are tax deductible.
    • SuzieSue
    • By SuzieSue 17th Apr 12, 3:57 PM
    • 3,108 Posts
    • 3,396 Thanks
    SuzieSue
    I went to the Halifax and said I would be renting out my house after 7 years as a residential owner and they said I had to remortgage and the costs were over £1k for each offer they gave me plus it was 3 point above my present mortgage. It was said on a take it or leave it basis as I explained I would be paying more monies than I did on my present mortgage over and above the rent and insurance I would be taking out.
    Other lenders are not so good and I agree "The Mortgage Works" offer does seem to be the best on a remortgage but again your fees which could be added to the mortgage are very high.
    The banks borrow at a ridiculously small interest rate and then screw their clients espicially as the government own a huge share of the Halifax!!
    Anybody got any good ideas
    Originally posted by Gilea22
    You could try taking out a fixed rate mortgage with them and then they should give you consent to rent for the period of the fixed term without any charges.
  • rt123
    From first time buyer to first time letter
    Halifax consent to let rates are a rip off. I'm remortgaging, from residential to buy to let, with Natwest. Free valuation and legal work. BUT my borrowing ratio is 75:25.
    Originally posted by jee

    Hi Jee,

    I bought my first house last September with Natwest as well but might have the oppotunity to move abroad with my work in about 12 months.


    How did you find the process & cost with Natwest? I already had to go with an extortinate rate in the first place because at 25 I didn't really have a credit rating and so went with my bank.

    I'm pretty lost with how to go about this and a concerned about the cost - any advice at all would be welcomed.

    Cheers,
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