Can I Let My Property on a Residential Mortgage?

rboltonuk

I bought a flat recently and am now considering not moving in to it as they have started laying people off where I work. My mortgage is with HSBC on a tracker which is quite low, im half anticpating that they might invoke some rule or say that it cannot be done without beign stung for a hefty re-arrnagment fee or increase in rates.

Any suggestions greatly welcomed...

rboltonuk

Apologies...when I say low I mean a low rate of interest....the repayments are not unfortunately. I am also wondering how long they will be low for...worrying times, so much to consider

samsuka

It depends on the bank. Some like C&G will allow you to pay £250 odd and convert your mortgage to a BTL. Others like Halifax to my knowledge say no and may ask you to pay redemption penalties or change to a worse mortgage.

Thounsands of people do this on the side, you aren't supposed to but people do it anyway, and i imagine in the current economic situation the bank would rather you pay the mortgage in any way you can, rather than default on it and lumber them with a house worth less than the mortgage.

Investigate the bank's rules, and then decide on whether to say something or keep quiet.

Ta

S

rboltonuk

surely if i decided to keep quiet and they found out id be the high chop tho...or even in the courts?

samsuka

Not really, the chances are they will just go down the easiest cheapest route, there isn't much to be gained for them to take you to court. Its expensive and you play dumb.

As i said, lots of people do it. They only find out when you get to the end of your term, or if you try and do something like change the address for post, etc. etc.

I guess you are better to go down the route of converting it to a proper BTL, but if this is expensive i would think of the alternative if its only going to be a short-term thing.

When you re-mortgage and don't live there you will need to change it anyway.

Ta

S

socrates

Firstly this is the wrong forum it should be under the "House buying, selling and renting" forum

This thread will cause the usual controversy there

movingforward2010

RBS were going to let me do it for £100, i think it depends on your circumstances, I told RBS i couldnt afford the mortgage and i was moving to my mums and could I rent out untill the market picks up - yes they said, better for them and you than a repo!

rboltonuk

scorates thanks for the tip got it wrong - first thread ever

wxmlad & samsuka cheers for the info

talana

Years ago I rented out one of my previous homes for a year while I went away to study. Informed my mortgage lender of the time (Yorkshire BS) and told them my plans.

Their reply was to the effect of "Thanks for informing us. You're allowed to let the property, but not on the deal you're on. Rules say you have to pay a fee and suffer a hike in interest rates. But since you're a valued customer and told us, we'll turn a blind eye and keep you on your current mortgage provided you let through a letting agent approved by us"
:T

It was only temporary and it was a fully-managed let.
But ask your lender, tell them it's something you're considering at this stage and not a definite plan. You never know what their response may be.

samsuka

socrates wrote: »

Firstly this is the wrong forum it should be under the "House buying, selling and renting" forum

This thread will cause the usual controversy there

I don't agree, its a question about mortgages, not about buying or selling a house. He is in the right place to ask about what a mortgage company will do.

Ta

S

socrates

It clearly should be in this section as he wants to rent the property out.

The mortgage is already in existence. All similar questions appear here.

At the end of the day its here now and its been done to death!