HALIFAX MORTGAGES Consent to lease rates versus their Standard Variable Rate

holly_hobby

Residential B&C is invalidated if the property is rented - so even if you did not tell Tesco, let the property and then claimed for a loss, they would be well within their rights to reject your claim, under non-disclsoure and breach of terms.

Same with a residential mortgage lender - if you let a property which is subject to a residential mortgage, without seeking the permission of the lender, you are in breach of your mortgage terms. Upon discovery, the lender may do one of several things, the most impacting one of advising you that they want the mortgage redeemed (i.e repaid), meaning you have to seek a remortgage to an alternative lende (pretty sharpish).

With regarding the loading on mortgage rate & admin fee related to Consent To Let - you have to understand that in letting your property, your are taking your residential mortgage (a mge contract on your main residence), to a semi-commercial lending - as your property is no longer your main residence, but to be let to a 3rd pty for financial gain. (i.e rent). The increase in mortgage rate is also in respect to the exposure the lender now has on the property - indeed some lenders don't even give permission for Consent To Let, so its not a forgone that every lender automatically agrees to such a request.

The alternative is to seek a remortgage to a But To Lender in the first instance.

Hope this helps

Holly

gents

I have sent in a letter of complaint. An odd thing happened. I received a letter saying that their terms and conditions might not have been very clear. In 2009 they put their interest rate up by an extra 1% above the base rate. In the letter they sent, they said that they were going to knock £4000 off the balance of my mortgage as a good will gesture. Very odd and I'm obviously happy about that, but they still havent answered my letter of comlaint about the permisison to let issue.

Thrugelmir

gents wrote: »

but they still havent answered my letter of comlaint about the permisison to let issue.

Unfortunately letting a property and the terms under which it is allowed is totally at the discretion of the lender.

Be grateful for the £4k and decide whether it is still worth letting the property.

JB613

Hi there,
Has anybody actually been told by Halifax how much these "additional charges" maybe that are levied on top of the SVR.

The reason I ask is because unfortunately I am in the same boat. I am in receipt of the same threatening letters. Having spoken with Halifax already I am really disappointed at just how bad their consent to let products are and how they are attempting to take advantage of the situation. I have looked through ALL of my mortgage documentation including my original mortgage agreement and also all the documentation I received when I gained consent to lease and there is no mention of these charges (despite in their last letter, Halifax said there was). I have also looked thoroughly on the internet and again can see no reference to these.

opinions4u

JB613 wrote: »

I am really disappointed at just how bad their consent to let products are and how they are attempting to take advantage of the situation

When they agreed to lend you the money to buy the property, they did so on the understanding that you were going to live in it.

As soon as you changed that arrangement, you changed the risk involved in the mortgage lending.

If you don't like what's on offer, change lenders. See what they charge you for a buy-to-let. You may find it's cheaper.

HARSA

https://forums.moneysavingexpert.com/discussion/3686659

Read this. She managed to remortgage to a BTL with just 0.5% more than what she was paying halifax

aggypanthus

gents wrote: »

I have sent in a letter of complaint. An odd thing happened. I received a letter saying that their terms and conditions might not have been very clear. In 2009 they put their interest rate up by an extra 1% above the base rate. In the letter they sent, they said that they were going to knock £4000 off the balance of my mortgage as a good will gesture. Very odd and I'm obviously happy about that, but they still havent answered my letter of comlaint about the permisison to let issue.

what was your complaint about exactly ,to make it worth 4k from them/
i am unclear, it seems very generous.

JB613

opinions4u wrote: »

When they agreed to lend you the money to buy the property, they did so on the understanding that you were going to live in it.

As soon as you changed that arrangement, you changed the risk involved in the mortgage lending.

If you don't like what's on offer, change lenders. See what they charge you for a buy-to-let. You may find it's cheaper.

I have no idea why people are getting so precious over this. I find it really surprising there are so many people and so strongly siding with the mortgage lender. Especially when the ethos of this site is about getting best value and not been taken for granted as the consumer!

My gripe is with the Halifax. I have been loyal for nearly 6 years and not done anything other than be the perfect consumer. I have had a change in personal circumstances and am looking for some assistance from them in return. I don't want to lease out my property. I do so out of necessity. I haven't made a penny from doing so and I will stop at the earliest opportunity. Yet Halifax want to tie me into my situation with extortionate fees, rates and ERC's. Unfortunately I can't move lenders but really feel Halifax are taking advantage of this fact.

opinions4u

JB613 wrote: »

I have no idea why people are getting so precious over this.

I'm not getting precious over anything. I have simply outlined the reasons for what is happening.

I find it really surprising there are so many people and so strongly siding with the mortgage lender. Especially when the ethos of this site is about getting best value and not been taken for granted as the consumer!

There is nothing to be gained from saying "what a big bad naughty nasty mortgage lender, how awful for you". It achieves what? Note that I suggested changing lender - that was to seek out better value. I'm sorry there are reasons that you can't do this, but that isn't my fault.

My gripe is with the Halifax. I have been loyal for nearly 6 years and not done anything other than be the perfect consumer. I have had a change in personal circumstances and am looking for some assistance from them in return. I don't want to lease out my property. I do so out of necessity. I haven't made a penny from doing so and I will stop at the earliest opportunity. Yet Halifax want to tie me into my situation with extortionate fees, rates and ERC's. Unfortunately I can't move lenders but really feel Halifax are taking advantage of this fact.

They could simply turn round and reject your request. You are not in any way entitled to let the property out. The terms of your mortgage forbid it. They have said that they will relax those terms and have stated what the cost of that is. You are in a take it or leave it situation.

Whatever the outcome, you want to change your mortgage from a residential to commercial arrangement. That changes the risk profile of the lending dramatically and, as a result, changes the price too.

Charging more for allowing borrower to let out their property is nothing new.

Not being precious. Just stating the cold hard facts.

If you're not happy with what's on offer, complain. Make sure they are following their own policy correctly (usually more flexible with a short term let, less so longer term).

JB613

Opinions4U apologies if it seemed I was having a dig personally at you. It wasn't intended to be so. But I have browsed these forums on numerous occassions over the last couple of years. I have been pleasantly surprised at some of the top advice I have found. However on the flip side I have also been surprised at some of the other opinions I have found. Again not pointing the finger at you specifically but, they have been harsh, rude and bordering on destructive.

Surely it's our entitlement as consumers to be able to question what is put before us. On the matter in hand yes banks and building societies have a massive hold over us when we are endebted to them to the tune of thousands of pounds, but we are still customers and have a right to question their level of service and products.

Halifax were happy to grant me CtL when I was on a mortgage deal arranged before 2008 and paying considerably more than what their current deals were. But I feel I am being taken advantage of when they want to charge me £1500 arrangment fee. This will in effect take me nearly a year and a half of mortgage payments just to get back to what the value of my mortgage is currently at now.

Of course I see that there is an increase of risk but I don't get how making it more expensive and therefore more difficult for me to meet those commitments makes their investment any safer. Infact is it not the opposite?!

Believe me I don't want to be in my current situation and as soon as I can get out of it I will do.