Nationwide increase monthly payments on fixed rate deal

ET1976

I have CTL on my Nationwide mortgage until October 2012 - does anyone know where I would need to look in the T&C's to see if this rate increase is allowed when they have already given CTL on the existing mortgage rate?

I would fully understand the increase if it were at the time of applying for (or renewing) the CTL, but I'm not sure if there is anything to prevent/allow them to change the terms during the period the CTL has already been agreed for.

jubjub

Hopejack wrote: »

jubjub - you are a btl landlord whether you like it or not, you rent out your property and I presume take a rental income every month for the sake of it! You only cease being one when you no longer rent it out!! I only hope you see your responsibility as a landlord as serious and that you abide by the minefield of rental and tenant law out there these days - saying it's a 'safeguard' to a judge wouldn't wash I'm afraid!

To to the OP - you'll need to check your terms and conditions carefully as per cj25's post.

I do abide by all the regulations as the property is let through an agency, the monthly income that you seem to think keeps me in champagne and Caviar doesn't even cover my mortgage on top of that I have all the maintenance costs,

Hopejack

jubjub, I never assumed that the income kept you in 'champagne & caviar' as you state, but you do obtain an income, from someone who pays to live in your property and make it their home, even if it doesn't cover all your costs. The fact that you mentioned you didn't see yourself as a BTL landlord, more 'safeguarding' your own interests was alarming to me. I am well aware that BTL does not always cover the bills having been a landlord myself over the years. I'm pleased you are aware of your responsibilities but please don't think using an agent means everything is rosy - another been there 'got the t-shirt' experience. Agents aren't always great and at the end of the day, legally, the buck stops with you as you are the landlord. Have a look on the 'house buying/renting' threads for proof of that.

Anyway, I digress from the original post...

jubjub

Hopejack I think we're going off at a tangent somewhat here I am not dispute that technically my situation is BTL, but the fact that all of a sudden that 2/3rds through my fixed rate mortgage they can justifiably charge another £400 a year extra admin costs and there is FA I can do about it. If I jump ship to another provider they charge me £2000 for early settlement, does that seem fair to you?

Poppy_Kennedy

I have a flat with Nationwide that has been rented for 3.5 years – typical, I just start to make a small profit and now this happens!! Have yet to receive a letter from them.

According to their website if you have rented over 3 years it will start in December 2010, and those who consent to let now it will start in September 2010.

1.5% to me, seems A LOT, 1% is perfectly justifyable.

jubjub

Why is any rise justifiable? what extra costs are they incurring? money goes from my account to theirs every month what has changed? If this is implemented unfortunately my tenant will have to pay more to cover it.

Poppy_Kennedy

Jubhub - i really dont want them to rise it, but the rate i have been paying is far lower than any other buy-to-let deals - to be honest, the fact they let you rent it for 3 years on a residential mortgage rate is generous.

This rise has !!!!ed me off, but, nothign i can do about it - we just have to suck it up

ET1976

jubjub wrote: »

Why is any rise justifiable? what extra costs are they incurring? money goes from my account to theirs every month what has changed? If this is implemented unfortunately my tenant will have to pay more to cover it.

Because a rented property is a higher risk than one you live in yourself - that's why BTL rates are higher.

The fact they let you rent for 3 years before putting the rate up is generous.

I think I've been very lucky so far and can't complain, I'll still be getting a better rate than I could by switching to a BTL mortgage.

jubjub

Because a rented property is a higher risk than one you live in yourself - that's why BTL rates are higher.

Why is it a higher risk?

ET1976

jubjub wrote: »

Because a rented property is a higher risk than one you live in yourself - that's why BTL rates are higher.

Why is it a higher risk?

you may have void periods.
you may have tenants who don't pay.
you may have tenants who trash the place and cause you to spend thousands on repairs.
etc.

I'm generalising, but many people with BTL mortgages rely on their rental income to pay the mortgage. This is (generally) less reliable income than that on which the lending for your own home is based (usually a job - yes I know people can lose jobs too), therefore it is a higher risk.

It's a pretty basic, widely accepted fact that BTLs are more risky for lenders than residential mortgages.