We're renting our home out: do we need to inform our mortgage provider?

clutton_2

""we may have to put renting it on hold if Clydesdale want a few hundred pounds,""

if you have not got a few hundred pounds spare - Dont go it renting - you Have to have a contingency fund for voids, trashed property, unpaid rent, court fees, boiler breakdown, agency fees, repairs and i could go on and on and on ....

Millburn_farm

Renting is expensive; especialy at the begining, and 1 bad tenenant and boy can you be out of pocket; I still have a writ against 1 couple for £9,000 in unpaid rent and damages; everything from the puppies they weren't supposed to have chewing window frames and doors; to redecorating because they were so filthy and leant all over the walls; oh and they emulsioned all my skirtings and doors. It took 1 day to pick up the rubbish, and 1 day to sweep and hover, then another to wash the carpets before deciding which ones just had to be replaced, which were most of them; I even had cigarette burns in the lino

Hannah-Holly

Commuting isn't an option: we are moving FROM Cheshire (in North West England) TO Middlesex (near London!) - I put Middlesex on as my location as I know we're going to be moving in a matter of weeks.

The thing is, we did have substansial savings, but since July they have been dwindled thus:
£30,000 deposit on Middlesex property
£1,500 on mortgage arrangement fees/solicitor's fees
£150 to get the electricity in the property checked and a certificate claiming it is safe
£200 for a gas certificate in the property
£700 for new carpets upstairs (we have a toddler! The carpets have taken some wear and tear!)

On top of usual monthly expenditure. I was a teacher, but I resigned to move with my husband. Naturally, we will expect to build our savings pot up again. It isn't completely bare but we really don't have much left. Most of the thingsClutton mentions in his post have been covered: we have a standing order with good old British Gas for boiler breakdown, for example. Court fees? Eek! What? Sorry, I am very new to this as you can doubtless tell ;o)

neverdespairgirl

lynzpower wrote: »

We are in Zone 1 and i takes OH 2 hours commute per day ( hour there & back) WITHIN zone 1. you could be risking losing thousands of pounds for saving one hour per day?? ALso how are you going to buy in london if your equity is tied up in the middlesex housE?

OH needs to get a bike, there's nowhere that takes an hour to cycle within zone 1.

dopester

Hannah-Holly wrote: »

Naturally, we will expect to build our savings pot up again. It isn't completely bare but we really don't have much left.

DSWDWY. Money, real liquidity, is king at the moment. Not property. I doubt all those pressing reasons for keeping your North West house will seem pressing reasons in 12 - 36 months time. You could have rented a house down South to see how things go without being locked down.

However I wish you all the best in refilling your savings pot and that your husband's dream job works out.

lynzpower

neverdespairgirl wrote: »

OH needs to get a bike, there's nowhere that takes an hour to cycle within zone 1.

Im buying him one for his birthday :cool:

EdInvestor

You do need to inform your bank.Some will just say fine, give us a fee.Some will require you to switch to a BTL mortgage (and pay fees to do so).Some will just let you do it, especially if there's a good reason, and a posting to a new location (especially overseas) is seen as a good reason.Some won't allow it at all and don't do BTL lending (this market has dwindled).

It would be a good idea to switch to an interest only mortgage (whether BTL or OO) as only the interest can be claimed against tax, and it will cut your outgoings.

ruggedtoast

[quote=franklee;13210685__Without_consent_to_let_the_tenant_has_no_protection_under_the_tenancy_agreement_and_thus_could_get_chucked_out_without_proper_notice_should_the_lender_repossess._Then_the_tenant_can_sue_the_landlord_for_breach_of_contract,_if_the_landlord_looks_to_have_any_money_left.[/quote]

With respect to franklee I dont think this is entirely accurate. Regardless of whether your landlord has permission to let or not the court will grant reposession to the lender irrespective of the AST you had with the LL. Theyre meant to give you notice (3 weeks I believe) but if they forget theres nothing you can do about it. One of my friends had less than a weeks notice from the court because though they told him there was a repo hearing they forgot to send him the letter saying when the bailiffs were coming.

If your tenants discover that you havent got consent to let however then they may decide not to follow any of the restrictions in your AST, and there may not be a whole lot you can do about it.

silvercar

Courts won't generally evict tenants if the mortgage grant specifically allowed for the property to be let. The lender, in granting such a mortgage, has acknowledged the rights of the tenants and will generally allow them to stay until the end of the fixed period of the AST. For this reason more and more repossession going to auction with a note that the property is occupied by tenants under an AST producing XX per month, ending on ZZ.

Incidentally it is mortgage fraud (obtaining money by deception...) to obtain a mortgage with the intention of letting a property. To a let a property that was your home obtained with a residential mortgage is a breach of the terms of your mortgage, but is not fraudulent. It is still necessary to have the correct building insurance and declare the income.

franklee

ruggedtoast wrote: »

With respect to franklee I dont think this is entirely accurate. Regardless of whether your landlord has permission to let or not the court will grant reposession to the lender irrespective of the AST you had with the LL. Theyre meant to give you notice (3 weeks I believe) but if they forget theres nothing you can do about it. One of my friends had less than a weeks notice from the court because though they told him there was a repo hearing they forgot to send him the letter saying when the bailiffs were coming.

Sorry to hear what happened to your friend, it's appalling. Did your friend establish if there was consent to let? I'd suspect there wasn't. If there was then the tenant should be given two months notice under ground 2 (as a minimum).

That is why consent to let matters from the tenant's point of view. No one wants to be put in the position your friend was.

PS As your friend wasn't given proper notice was it worth him suing the landlord for breach of contract?