Consent to let

Windsorcastle

I have recently let out my property and have informed my insurers so I do now have the correct insurance for a rented property. However, I have not told my mortgage company (Halifax) because it sounds as if they will force me to take out a new mortgage. Will my insurance be OK in this instance? And will I get in trouble with Halifax if I now go to them to obtain consent to let retrospectively? I'm confused.

I already have an ongoing claim for subsidence that was ongoing before I let out the property, so I was on the correct mortgage and insurance when I started that claim. Can anyone advise me what I should do please?

N79

Apply for consent to let and if it is refused give your mortgage to a new company or a Halifax BTL.

poppy10_2

StiflersMom wrote: »

Your insurance and any consent to let from your mortgagor are unrelated.

Not true. If you have lied about your mortgage then your insurance could well be invalid. Insurance for a house which is rented out is higher than a house which residential-only, for good reason.

Pitlanepiglet

Assuming that the Insurers know that the house is let then that's all that matters. The Insurers won't care whether the mortgage co know or not.

I wonder if the insurance is through the Halifax by the way the question is phrased though?

ghostbusters

the reason you haven't told the mortgage company is because it will cost you more money or because you didnt know you could rent out under your current mortgage.

why not be honest with the companies involved??



I personally don't see any other option ...

G_M

poppy10 wrote: »

Not true. If you have lied about your mortgage then your insurance could well be invalid. Insurance for a house which is rented out is higher than a house which residential-only, for good reason.

Not true. If the insurers know the house is let (as the OP says), the insurance will be valid. I have never known insurers ask "Does your lender know the property is let", so I doubt the OP has lied to them.

dopester

Above banner is not Shelter official, but one I created. I believe the information to be correct as per Shelter's official information below. (or click through on banner to Shelter webpage for full information):

Can people with mortgages legally grant a tenancy?

Yes, but only if their mortgage deed says it is allowed and/or they have their lender's permission. Most mortgage agreements do not allow tenancies to be granted without permission, and many lenders will try to repossess the property if they find out that this has happened.

What about buy-to-let mortgages?

If your landlord bought the property through a buy-to-let mortgage, you will normally be in a stronger position than if your landlord's lender did not know that the property was rented out. This is because your tenancy has effectively been formally recognised by the landlord's lender, which means that it is binding on them (see below).

If the lender gets a court order to repossess the property, they would normally have to give you proper notice if they want you to leave. The amount of notice you are entitled to will depend on the type of tenancy you have.

What notice am I entitled to?

Lenders are often unaware that a property has been rented out to tenants, so it is common for legal proceedings to be started (eg for mortgage arrears) without the tenants even being aware that there is a problem.

Since April 2009, lenders are required to send a letter to the property addressed to 'the occupiers', informing everyone who is living at the property of the date of court hearing. They have to do this within five days of the hearing date being confirmed by the court. You should therefore always open post addressed to 'the occupiers' - do not assume that it is junk mail!

After this, the only notice that you will be given is if the court agrees to give the lender possession. If this happens, the court will send a notice to the landlord and 'any other occupiers', informing them of the date that the bailiffs will be coming to repossess the property. This notice (form N54) may only give a few days' notice of an eviction, so get advice immediately if you receive one.

jsh99

We have a Halifax residental mortgage but let the property with 'Consent to Lease'.

We had the mortgage for 15½ years, then wanted to move so arranged the CTL with Halifax and then rented the property.

We didn't have to move to a BTL product but we did have to get the mortgage below 75% LTV.

It was relativley straightforward - just speaking to a branch mortgage adviser, filling in some forms and sending them back. Took about three weeks from start to finish.

HTH.

Windsorcastle

Thanks everyone for the helpful advice.

I decided honesty was the best policy and went to see the Halifax - I just had to sign a couple of forms and they let me keep my current mortgage exactly as it is (because it's less than 75% LTV), and are granting me consent to let for 3 years - they didn't even charge me a fee!! I was amazed how quick and painless it actually was. They did want to check my insurance and were a bit surprised I already had insured it as a let property, but I just said I had done that in anticipation of letting it out, as I'm currently liiving mostly at my partner's. No more questions asked.

I'm still confused as to whether I needed to do it, but am feeling much more relaxed now that I know everything is above board.

My only question now is - do the Halifax inform the tax office I am letting the property out, or do I ned to contact them myself and do a tax return?

Many thanks again for everyone's advice. It's a weight off my mind! :j

ET1976

You need to contact the tax office yourself.

And yes, you did need to get consent to let, although there are people who will tell you there's no need to bother...

Fire_Fox

By getting a consent to lease you can ensure that your tenants don't receive 'sensitive' mail such as your annual mortgage statement! You also ensure that the tenants AST is recognised in case of repossession. One of the regulars on this board recently had tenants asking to see consent to lease, so it is something that has the potential to affect the let-ability of the property.