Mortgage Query

rajakumar

Hi all,

we have bought a house last November and I went for fixed rate mortagage for 2 years.Now, I have a good job opputunity elsewhere and I'm willing to relocate. I don't want to sell the property, I want to leave it to rent.

I want your advice on what I have to do in this situation? Should I need to contact the lender and inform them to move the mortagage to Buy-to-let. I presume this cost me more.
Can anyone give me suggestion on how I should deal this effictively?

Thanks in advance for your help!

homer_j_3

My first step would be to speak to your lender and ask what their policy is on letting a property out.

If you explain that you are possibly moving roles within your firm and you want to ensure it is right before you move house fully, they should tell you what you need to do.

You shouldnt need to goto the full expense of remortgaging on a buy to let as the lender will probably send you an app form out and ask for a fee to consider with a view to putting a small increase on your interest rate. May not be the most competetive int rate but allows you a chance to see if you like the new role..

maryjane01

My partner rented his place out without letting Northern Rock know, then when his tie in period was up he remortgaged on a BTL mortgage with another lender. He did not tell Northern Rock he had moved, he just got his mail redirected. I think if he had told NR he would have had to pay them an extra fee.

I guess there could be a problem if something happened to the property and there was some issue with insurance.

rajakumar

Thanks for the reply.

I will speak to the lender. I'm now on 4.24%, defnitly I'm not going to get this deal.

Want to know what kind of problem will we face if we don't let the lender know about our move ? Will our credit score will be effected?

ohmsoft

It's not a credit score issue - but a legal one. Somewhere in your terms and conditions it will prohibit sub letting and threrfore you could be prosecuted for breech of contract (of course that is unlikely) - I've seen many cases where folk don't tell their mortgage lender they've moved but wouldn't really advise it.

homer_j_3

who is your lender - maybe one of the brokers has experience on their policy or even another borrower with the same lender?

rajakumar

A&L is my lender.

homer_j_3

A&L are not on my current panel of lenders so I am not sure. Give it the weekend for another broker or for someone who has gone through this with the A&L and if no response, give them a call

MarkyMarkD

A&L will allow you to let in exchange for a letting permission fee.

They won't charge you extra interest, unlike some other lenders.

Shouldn't be any problem - just contact them and ask for permission to let.

BUT the problem you are likely to face is getting a mortgage for your new property - almost all lenders will require you to have cleared your original loan and you will have to explain the rental situation clearly to get around this. I'm sure the brokers on here can advise about this more tricky aspect of the situation.