Northwood Platinum Guaranteed Rental Scheme

jonny2510

For a variety of reasons we are considering renting our house out.

It's been up for sale on the market with little interest for 10 months now (I know, I know, we should half the price etc etc - though we're not willing to do that just yet!), and we were thinking as an alternative to move out and rent it out.

I've come across the Northwood Platinum Guaranteed Rental Scheme and the offer (whilst obviously lower than the potential rent if the house were occupied over 12 months) does still seem pretty reasonable. (In fact after taking into account potential voids, waiting to let the property and the fees / comission estate agents charge - it seems to only be around £400 less per year than using a standard managed rental service - i'll check the figures using a spreadsheet later...).

I'm going to get more quotes from other lettings agents to compare, but wanted to know if anyone here had used Northwood / a similar scheme, and what their experiences were?

It's a tough decision to make as to whether to rent or not, and I think (hope) this scheme would be able to give me a bit more peace of mind in doing it...

Anyone care to comment?

jonny2510

<Bump> anyone???

guppy

I don't know what it is, but surely there must be a catch?

SquatNow

jonny2510 wrote: »

It's been up for sale on the market with little interest for 10 months now (I know, I know, we should half the price etc etc - though we're not willing to do that just yet!), and we were thinking as an alternative to move out and rent it out.

When will you be willing to do it... once everyone else has slashed their prices...?

You're playing a very stupid game "called hold out for a quick recovery that isn't coming then chase the market down".

House prices arn't going to start rising again soon. No-one is going to magically restart the housing market. Banks arn't going to start landing recklessly again.

If you NEED to move and you CAN slash the price then DO IT NOW.

poppy10_2

Sounds like a good deal, you take the £400 hit in return for knowing your monthly income is fixed and you don't have to worry about voids or the tenant doing a runner etc.

teabelly

The rental guarantee scheme is usually pitched so that the agent won't make a loss. If your house is something like a 2 bed terrace in decent condition then you probably won't have a problem renting it anyway. Have a look into rental guarantee insurance as you can get that for £125 a year and that covers you for loss of rent. It isn't as good as a guaranteed scheme but it is cheaper and covers you for legal costs if the tenants default.

If you rent it out you'll have to switch to a BTL mortgage or get permission to rent. The LTV wanted will be a minimum of 85%, most likely 75-80 and the rent needs to cover the mortgage and exceed it by 25% if you want to pull out the max equity. You'll need extra money for unexpected things and for an energy performance cert. If you have one in the HIP then I think you can reuse that. You'll also need new home/buildings insurance and gas safety which will add another few hundred quid onto what you need to spend above making sure the place is in a rentable condition.

If you are having trouble selling then it is over priced so I think you may find that you won't get out as much equity as you thought if you remortgage to a BTL. If you are buying a new property and don't intend keep the old one long term then you are better off knocking off 10-20k to shift it. Holding onto the old one short term at the moment is probably financial suicide.

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