Birmingham Midshires buy to let and a £50 charge for not taking out buildings cover.

HugoSP

In 2007 we bought a buy to let and financed it via Birmingham Midshires.

Just before Christmas we received our annual mortgage statement, and I was surprised to find a £50 charge for not taking out their buildings insurance.

I thought this was a bit strange as we had told them that we had a blanket buildings policy to cover a number of BTLs.

In the new year I contacted them and quesioned this. I was told that Clause 9 of my mortgage agreement stated that this was added to the mortgage account in the event of taking out my own buildings insurance.

I then dug out my mortgage agreement and found that this was the truth, but not the whole truth. The clause then went onto say that, in the unlikely event of the associated company not being able to offer suitable cover then I should contact them within 30 days and the charge would not be payable.

I was asked to write in regarding this. I had discussed this with their insurance agent whilst the purchase was going through and he confirmed that they did not insure buy to let properties. I put this in writing and within 2 days of sending the letter off, BM waived the charge.

It seems that I had quickly established that BMs agent could not offer suitable cover, but this fact was not passed onto the mortgage account.

There are several reasons why a mortgage co's agent may not be able to offer suitable cover. BTL is just one. Another, for example, could be that the building is subject to subsidance, and hence a specialist co would be needed. I know someone who was in this situation.

Robert_Sterling_3

Thank you for your post.

HugoSP

No Problem - happy to help.

I suspect that a number of people have had this charge added to their account and it would simply take a letter to resolve it.