Consent to let?

Cezzabelle

I've moved away to live with my partner and whilst I have put my flat on the market it hasn’t generated much interest. Its looking likely that I will rent it out instead as I cant afford to have it standing empty. My mortgage is with the Woolwich who I know give consent to let, but only if you are going to move back into the property at some time. Problem I have is I don’t know whether we will or not-I realise I could lie but we are buying a house together elsewhere, so I'm wondering if anyone knows what checks or questions are asked by them when you request consent to let.?

Also if I don’t "pass the test" and cant show/convince them that we will move back in at some point-how do they force me to change the mortgage to a buy to let- I cant afford the fees of doing that and don’t have savings to cover the required 25% deposit or whatever it is for a B-T-L mortgage anyway (and there isn’t enough equity in the flat) so I'm just wondering where that would leave me? Any thoughts greatly appreciated!

Cannon_Fodder

Assuming you got consent-to-let, a change to BTL would be required at re-mortgage, or (varies by lender) between 1 and 3 years.

If you cannot afford the fees and don't have equity in the property anyway, then its probably sensible to bite the bullet and make sure it sells, before spending any money on it - you'd have to get it up to standard for renting out, and the consent-to-let will have a fee, etc.

More so, if you might fail to convince them to give you CTL, and your re-mortgage is close at hand.

franklee

Sounds like you can't afford to buy another property and keep this one. Letting out comes with costs attached and risks of voids or tenants who cause damage or don't pay the rent. You shouldn't do what you are planning with such little margins so taking on more house debt isn't a good idea and could land you in real difficulties IMO.

Cezzabelle

I probably could afford to have it empty, if I had to, but I take your point/appreciate the advice Franklee-its not a good time to be gambling with finances! Its just there doesnt seem any point having an empty property thas two hours away from where i live. ( we both have jobs here now so cant/dont want to go back) It wouldnt get us into debt keeping it-other than the fact we are paying mortgage on a property we cant use. I'd love to sell it now if I could but no one seems to want to buy it :-(

Cannon fodder, my mortgage isnt for a fixed period ( i had fixed and when that ended i just let it go onto variable so there were no penalty clauses if it did sell) so I dont think there is a "re-mortgage time" does that affect/change your advice?

Cannon_Fodder

Being out of the fixed deal moves the problem from 're-mortgage time', to 'rates rising time'...the variable will go up, probably a bit within 12 months, potentially quite a bit more within a couple of years.

Before which you would want to get a decent Fixed deal to protect your monthly payments from getting painful - which would involve converting to BTL, paying the appropriate fee and rate etc - except you still won't have the equity (25% usually) to secure a BTL.

Not being able to sell, is often down to price. Rather than spend a fee on BTL, or cover the costs of it being empty for 6 months, you could just knock £3k-£5k off the price, see if it works.

prudryden

I personally would lower the price and get rid of it. Renting out property, without the knowledge of all the "variety 57" regulations, can become a noose around your neck, as Frank points out, and can generate a multitude of problems.

madeupname1

Cezzabelle wrote: »

Also if I don’t "pass the test" and cant show/convince them that we will move back in at some point-how do they force me to change the mortgage to a buy to let- I cant afford the fees of doing that and don’t have savings to cover the required 25% deposit or whatever it is for a B-T-L mortgage anyway (and there isn’t enough equity in the flat) so I'm just wondering where that would leave me? Any thoughts greatly appreciated!

Theres a long, and not always helpful, thread regarding refusal of consent to let on a Halifax mortgage. I think its in the Mortgage Endowments forum.