Opportunity to move to oz but mortgage company wont allow me to let property

dangerousdodo

I have received interest from a couple of companies to work in Australia, they are great opportunities and the money on offer would be signifcantly more than what I earn in the UK.
I made an enquiry to my mortgage company ,First Direct about the options with letting my property whilst abroad they have advised me that they don't allow it and they don't do buy to let mortgages.

I may have been ignorant but I expressed surprise that they deem this situation to be a "buy to let", and informed them that the move is not necessarily a permanent move and that I may be back in a year or so (a tact used by a former colleague who moved down under a couple of years ago). They went on to say that they would only ever consider giving permission in exceptional circumstances for the short term this would be providing the vendor was working for the same company.

My concern is that we may have to transfer to another mortgage, this may be difficult as we have a number of other credit committments.

I don't wish to sell the house in case it doesnt work out in Australia and we come home and have trouble getting another mortgage.

Are the mortgage company stringing me a line or are they entitled to do this? I find it very dissapointing as I have been with FD for a number of years and they have provided pretty good service in the past- how things have changed!

Any advice would be appreciated.

Thanks
ddd

GMS

The lender are not obliged to agree to any changes to the terms of the mortgage you signed with them which was a residential one. Terms clearly state it is for residential use.

Could you remortgage to another lender on a Buy to Let basis? Your credit commitments would not necessarily be an issue if the rental income was sufficient to cover the mortgage plus a set percentage.

Pocket_AAs

Do you even have to tell them??

Can you not move and rent the property out?? As long as you pay them the mortgage.

(not trying to be dishonest although I have given that impression...)

GMS

Letting without permission is a breach of mortgage terms and likely to lead to further action by the lender. Even more of a problem when on the other side of the world.

Property would be uninsured as require landlord insurance to let, and any insurance companies need to notify the lender of any change generally so when FD are informed landlord insurance taken out OP is back to square one.

Big risk to take

Pocket_AAs

I see.

Thanks for clearing that up.

dangerousdodo

GMS wrote: »

Letting without permission is a breach of mortgage terms and likely to lead to further action by the lender. Even more of a problem when on the other side of the world.

Property would be uninsured as require landlord insurance to let, and any insurance companies need to notify the lender of any change generally so when FD are informed landlord insurance taken out OP is back to square one.

Big risk to take

Great advice G thanks!

dangerousdodo

GMS wrote: »

Letting without permission is a breach of mortgage terms and likely to lead to further action by the lender. Even more of a problem when on the other side of the world.

Property would be uninsured as require landlord insurance to let, and any insurance companies need to notify the lender of any change generally so when FD are informed landlord insurance taken out OP is back to square one.

Big risk to take

Do you have any suggestions on mortgage providers for buy to let, are there specialist buy to let providers , or is it a case of just doing my own search?

dangerousdodo

GMS wrote: »

Letting without permission is a breach of mortgage terms and likely to lead to further action by the lender. Even more of a problem when on the other side of the world.

Property would be uninsured as require landlord insurance to let, and any insurance companies need to notify the lender of any change generally so when FD are informed landlord insurance taken out OP is back to square one.

Big risk to take

Any recommendations on mortgage providers , is this a specialist product or do most financial institutions provide buy to lets?

John_Pierpoint

As a new landlord you would need to understand all the laws and obligations you would be taking on.

For example tenants would be advised to deduct tax from any payments made directly to you as a foreign resident.

http://www.mortgagestrategy.co.uk/buy-to-let/number-of-b2l-products-doubles-in-a-year/1029196.article
[Lovely typo ......Houses in multiple locations ]
http://www.thisismoney.co.uk/mortgages-and-homes/buy-to-let/article.html?in_article_id=529381&in_page_id=56&ct=5

http://www.mortgageintroducer.com/mortgages/239906/238/Buy-to-let/TBMC_selected_by_Skipton_Building_Society_to_distribute_new_buy-to-let_range.htm

http://www.moneymarketing.co.uk/mortgages/nationwide-caps-interest-only-lending-at-75-ltv/1029129.article

http://www.landlordexpert.co.uk/index.php/news-centre/4284.html

GMS

dangerousdodo wrote: »

Any recommendations on mortgage providers , is this a specialist product or do most financial institutions provide buy to lets?

Many do but you would be better seeking the help of a Whole of Market broker as there may be broker only lenders.

What is the property worth?
What do you owe on current mortgage?
What would you expect rent to be per month?

If you look yourself be careful. Some will not allow first time landlords so must have other Buy to Let property. Some want a minimum income, some dont. Rent needs to be looked at as the lender will want the rent to cover the mortgage plus a percentage, typically around 30% above.

socrates

GMS wrote: »

Letting without permission is a breach of mortgage terms and likely to lead to further action by the lender. Even more of a problem when on the other side of the world.

Property would be uninsured as require landlord insurance to let, and any insurance companies need to notify the lender of any change generally so when FD are informed landlord insurance taken out OP is back to square one.

Big risk to take

I have never heard of an insurance company informing a bank that landlord insurance has been taken out and thats in 20 years of BTL.

FD are very inflexible when it comes to Conset to Let - they will never budge.

You need to make a call as you see best and if you have someone in place you can trust to run the show while you are away then do as you please.

The people on this board do not pay your bills and we are talking about real money here.

My opinion is the banks never came to us for consent for anything when they screwed us over and we are still paying for it!

Make sure you pay your mortgage on time, perform all your legal obligations as a LL and it is highly unlikely that anything bad will happen.

I really do not care what the scare mongers say - that is the long and short of it!