What happens if you have a mortgage, things go wrong and you need to let?

pph

Hi, my Mrs and I are thinking of buying but it is tight as if we lost our job then the other could only just cover the mortgage. Were one of us to lose our job, we've been told to just rent it out. How are the mortgage companies with this? If you can't rent it out for equal to the mortgage repayments (e.g. you are £300p/m short), can you top that up yourself?

Thanks!

Thrugelmir

we've been told to just rent it out

Sounds the easy answer to a difficult issue but isn't.

Potentially could cost you far far more if it doesn't work.

I would consider selling up if you genuinely end up struggling.

mynameisdave

You havent even bought yet, as I understand it?

If it is going to be so tight then it may not be a sensible move.

Lenders do offer consent to let on residential mortgages when a borrowers situation has changed but they may ask for the projected income to cover the mortgage - after all you will still need to rent somewhere and pay that too!

poppy10_2

pph wrote: »

Were one of us to lose our job, we've been told to just rent it out.

Not as simple as that. You would have to seek and obtain consent to let from your mortgage company, which they may charge for. Plus if you let for more than a certain period of time they could increase your interest rate.

surreybased

Also consider the additional costs of renting it out - insurance, gas checks, management fees, voids.
The rental potential should be in excess of the mortgage payments so that you are able to manage.

who has given you this advice? I would be highly suspicious if it came from someone with a vested interest - i.e Estate agent.