Renting my house - do I need to change mortgage?

Warchcosi

My wife and I are trying to sell our house to relocate but currently to no avail so it looks like we may need to consider renting the house instead to allow us to move.

We currently have a great tracker mortgage with A&L which is the good news but I seem to be getting conflicting reports on whether or not we can keep this mortgage and rent the house out or whether we would be forced to switich to a different mortgage with a awful rate.

Do I have to tell my mortgage company if we decide to rent? If so, can they force me to change my mortgage or are they obligded to let me stay on the same product?

Thanks in advance

starlet1526

I am in the same boat - I have changed my contact address with mortgage company and they have now sent me a letter asking why i have done so and have said that if I'm letting it out i would be breaching contract.

Should i come clean and tell them that I'm letting it out ? If i do so am i likely to be charged money or made to change mortgage ? I am in a fixed rate till end of June.

geoffky

if you do not tell your insurance is invalid and the mortgage company may have something to say legally...you need to tell them because if you dont and get caught out there is some consequences and one of those is to call the mortgage in...

Mrs_pbradley936

Phone and ask them, they might charge you a fee but you should let them know.

geoffky

Do you understand about protected deposits and all the legal stuff like that...all the safety certificates needed for appliances... i think you need to do some homework because a tenant could end up costing you if you do not know the laws...

starlet1526

i have all of my gas safety certificates and the correct house insurance.
I do not manage the property myself - i have a letting agency doing that for me so they have collected the appropriate deposit. The only thing i wasn't aware of was the mortgage - we bought the house to live in, our circumstances just changed.

starlet1526

I imagine the bank will have some sort of fee when i tell them - do you think they would let me add this onto what i owe ?

Mrs_pbradley936

starlet1526 wrote: »

I imagine the bank will have some sort of fee when i tell them - do you think they would let me add this onto what i owe ?

I don't see why not. There must be lots of people in your situation and they don't all have to change mortgages.

I would just ring up or email and say "My/our personal circumstances may be changing and I/we were considering renting out house via an AST (legal term for tenancy which agent can sort out for you stands for Assured Shorthold Tenancy). Are there any formalities I/we need to comply with if we decide to do this?

You will need to pay tax on the rental income too.

Pring

Speaking from personal experience here, I know the Halifax/Bank of Scotland insist that you move on to their Consent to Lease product which'll cost you 999 product fee and is fixed at about 5% for 3 years. No negotiation... or so I was told.

Other lenders may be different but I imagine most are trying to grab as much money out of you as possible!

m_13

starlet1526 wrote: »

i have all of my gas safety certificates and the correct house insurance.
I do not manage the property myself - i have a letting agency doing that for me so they have collected the appropriate deposit. The only thing i wasn't aware of was the mortgage - we bought the house to live in, our circumstances just changed.

Most letting agents have updated their terms and conditions to say that you agree that you have your lender's consent to let. If you've signed to say that you have and you haven't you could find yourself with problems. Particularly if your tenants take the advice on this forum and obtain a copy of the land registry details for the house and discover that you are listed as still living at the property (the change of address being the very trigger that has found you out with your lender). The advice given on this very forum is to report you to the letting agent and also the tax office so I hope you've told them too that you are now getting income from renting a property!

theartfullodger

Or, to put it more simply & directly, be honest and comply with the law.

Doh! Silly me, everyone does anyway, no need for this advice

Lodger