Renting house out for a year with The One Account

BicycleBill

Hi all, lurked for a while but this is my first post!

I've recently been made redundant and am planning on taking career break of a year off to realise a life long dream of cycling overland to India. In order to do this I really need to rent the house out... I've found friends who are interested but I'm worried about getting in touch with the mortgage company (The One Account) as they don't do buy to let mortgages, and I'm not sure what their reaction will be in this case. From looking at what happens with other mortgages it seems some providers are OK, some not so, so I'm interested if anyone has similar experience with The One Account.

I'm tempted just to go for it as I've people who can look after the house if anything goes wrong and it's in fairly good shape (e.g. new combi boiler installed less than six months ago). Anyone know what the implications would be of not informing the mortgage company?

princessamy86

I don't know about the One Account in particular, but you don't necessarily need a buy to let mortgage, just consent to let. It's for a fixed period, so they might look upon it a bit more kindly knowing that you will be back as owner occupier within a set timescale. Implications of you not telling them: if they find out (and they will!) then you have committed mortgage fraud-edited to say I stand corrected by silvercar, ignore me!

silvercar

princessamy86 wrote: »

Implications of you not telling them: if they find out (and they will!) then you have committed mortgage fraud.

Firstly, they will find out if your tenant, a neighbour or a friend of yours tells them. Its a risk but its not a definite.

Secondly, it is not mortgage fraud. Fraud is where you obtain a mortgage by giving false information. Ie you apply for a residential mortgage with the intention of letting the property. As you already have the mortgage and presumeably did so by making an honest application for a home that you intended living in, you won't be committing fraud.

You will be breaching one of the conditions of your mortgage. Your lender could insist you pay a fee and possibly move to a higher interest rate, or your lender may give you permission for a year with no hassle.

If you failed to keep up with mortgage repayments and your lender repossessed, your tenant could sue you for breach of contract as you have failed to make the property available to them for the term of the contract.

Theoretically your lender could call in your mortgage as you have breached one of the terms. AFAIK no lender has ever gone to court where payments have not fallen into arrears. No lender has gone to court and applied for repossession and the eviction of a tenant where a landlord has kept up with repayments.

In the event of a repossession your tenant would have less rights than on a mortgage with consent to let and the tenant could take action against you if they lost their rental home because of this.

Gorgeous_George

If you agree that your friends live in the property (without a tenancy agreement) while you are travelling, they can look after the property in return for living their rent-free

Depends how much you trust your friends.

I recommend getting consent to let and having a professionally written tenancy agreement. If it is definitely one year, say so in the agreement. Serve a S21 (sword of damocles) as part of the agreement. Consider what you would do if things go wrong and have a Plan B just in case.

GG

BicycleBill

Thanks silvercar... the people moving in are fine with it and I doubt the neighbours will say anything. I've enough money to cover my mortgage for the year I'm planning to be away even if the guys moving in don't pay a penny, so payments will continue as normal regardless. And when I get back it will be my residence again, although I will need to find another job of course!

My main concern is I don't want to approach the mortgage comapny and get knocked back or told I need to move to a much higher rate that I can't afford, so I'm hoping someone with specific experience of The One Account.

someusername

hi there,
i've just called the one account about my own account;
the cost is £100 & as long as you're planning to return in the future (say 12 months) & you're not going to rent in Australia(?) it's absolutely fine.


hope that helps,

cheers

Richard