Is this buy to let or not?

Icequeen1

Hi

Our situation is that my husband and I owned a house outright with no mortgage. A few years ago we remortgaged (LTV is about 50%) and used the money to purchase a holiday home. My husband's elderly parents live with us in the house. Room is at a premium, and if we decide to have children, we would want to move out so as not to unsettle them.

I have two questions:

1. If we were to move out and rent another property, and allow my parents-in-law to remain in our house, do we need to inform the mortgage company and would we need a buy to let mortgage (we wouldn't actually we taking any rent from them, they live with us free of charge).

2. If we were to move out and want to buy another residential property, would we need to switch the mortgage to buy to let? is it possible to have two residential mortgages? Again, we wouldn't be letting, the would live there free of charge.

Unfortunately I haven't found the information in our documentation very clear so far although it does mention as a condition that the house should be our 'main residence' but on the other hand a buy to let seems wrong when in fact we are not letting as such (or maybe we are?).

Thanks in advance

L

payless

some lenders will consider relatives ( esp if deemed depenadant) as Ok for a residential mortgage, and of course if new mortgage is your own main property then again its residential- so long as your income covers both

luckyfool

Yes, basically depending on the lender both can be residential . . . but only if you can afford both. You cannot switch it to buy to let as a) its your parents staying there, and b) they are presumably not paying rent. Most mortgage lenders would not consider the property to be self supporting.

Icequeen1

Thanks for the replies. The lender is the Co-op, but it was the 'main residence' condition of our current mortgage that was slightly worrying me.

Income wise we can easily support mortgage and rent/other mortgage. The holiday home is owned outright and actually is now let out on a long term let.

So if we do move out to a rented house, is this a change that needs reporting to our current lender?

L

payless

I think yes you should be assessing their feelings at this stage