Advice needed on Letting out property

mconnolly81

Precisely. However maybe 'Loophole' wasnt the best term to use

FraudBuster

A bump.........

G_M

FraudBuster wrote: »

A bump.........

Because......?

(thread overtaken by new one here)

jendav

Hi there,

Have been in exactly the same situation lately. Have decided to rent, as can't afford to sell. Financial adviser scared the life out of me when she said that most lenders are doing what Halifax has done to you, and force you onto a new buy-to-let product which has a higher interest rate and leaves you in another difficult position - either sell and lose money, or go to a higher interest rate and lose money. We have been extremely lucky in that we are on a standard variable rate with Lloyds, which is better than general market rates, and they have given us consent to let (thank God!). So the only thing I can suggest is that it might be worth looking at Lloyds. You'll have set up fees and all the usual, but maybe they are more agreeable than Halifax.

Also, financial adviser also said to me you can't avoid the consent to let issue. When your tenant moves in, the council tax register will be updated with their details. The lenders apparently get a red flag if there is a change in details that conflict with their records and then you're in a bit of bother with mortgage contract breach. Sorry, don't mean to scare you...just wanted to share what I've found out recently.

Best of luck.

brit1234

FurryPaws wrote: »

Being an accidental landlord is an effect from this downturn in economy

No it is you buying a vastly inflated property in a giant housing bubble during a period of greed and fraud.

The simple fact that you are unwilling or unable to sell at a realistic price is not due to the so called downturn. The purchase price was agreed by you, after all prices don't always go up.

moneybunny123 above makes the most sensible and clear point here. What are you going to do as house prices fall further and you need to remortgage with no equity?

I would price to sell now before things get worse as prices continue to fall.

jimjames

Problem is if you are in negative equity territory then remortgage is out of the question too as they'd need a big deposit. Most BTL mortgages as well will be looking for 25-30% deposit.

jendav

Brit1234, that really isn't fair. The fact is that a house price is a house price - if you want to get on the property ladder, you have to pay whatever the market dictates at the time. It's no good saying now with hindsight that it was a period of greed and fraud. House prices have continually risen for years so what do you say to those who bought 15 years ago? You buy when you are able to...that's all there is to it. There are so many who are now trapped because they worked hard, got a deposit, bought a property, and thought they were on their way. No-one knew the market would crash and it is a terrible thing to feel that you are trapped in that property for years to come until the market recovers again.

brit1234

jendav wrote: »

Brit1234, that really isn't fair. The fact is that a house price is a house price - if you want to get on the property ladder, you have to pay whatever the market dictates at the time.

You also have the choice not to jump on the property ladder at the time and rent waiting for house prices to correct. Saving a deposit during which.

jendav wrote: »

It's no good saying now with hindsight that it was a period of greed and fraud. House prices have continually risen for years so what do you say to those who bought 15 years ago?

Its not hind sight it was fore sight a big difference. If it was hindsight I wouldn't have a big deposit saved up during the housing bubble and dead cat bounce.

Its fore sight and common sense that tells me that house prices will continue falling from this point on and they are presently still overvalued.

jendav wrote: »

You buy when you are able to...that's all there is to it. There are so many who are now trapped because they worked hard, got a deposit, bought a property, and thought they were on their way.

There are many trapped because they lied about their salary, borrowed too much or had very little in deposit.

jendav wrote: »

No-one knew the market would crash and it is a terrible thing to feel that you are trapped in that property for years to come until the market recovers again.

Yes they did and many were warning about it, it was blatantly obvious. I knew and prepared for it, there were even websites devoted to it.

As for the market recovering I guess you mean a return to peak bubble prices. That's not going to happened for many years perhaps next decade due to the scale of the correction needed.

dopester

jendav wrote: »

You buy when you are able to...that's all there is to it. There are so many who are now trapped because they worked hard, got a deposit, bought a property, and thought they were on their way. No-one knew the market would crash and it is a terrible thing to feel that you are trapped in that property for years to come until the market recovers again.

Lots of people expected a crash. I could but didn't buy from 2004 onwards - to my own cost as house prices kept shooting upwards.

Shooting upwards as others merrily kept borrowing ever more money month on month, year on year, to pay ever higher crazier asking prices - setting new market values upwards.

The simpletons who "thought they were on their way" and expected house prices to keep on trebling every 7 years, can stay in their 1 bed shared ownership gash flats in epic negative equity, whilst I buy a 3 bed nice house dirt cheap. The market isn't all easy win, buy whenever and you can't lose. You paid the price that others refused to. You have personal responsibility for your decisions. You got what you wanted at a price you were prepared to pay.

jendav

I have to give you credit for that foresight. My point is that house prices always go up, along with everything else. House prices today or 4 years ago are higher than 1990, 1976, 1950, etc. You have to bear the fact that prices will always rise and buy when you can. If you are able to predict a housing crash and decreasing prices, then you are very clever but I wouldn't point the finger at people who are now in trouble. I think you'll find they were not scheming but just hard working sincere people who bought when they could and now don't want to walk away from all their hard work. The poster has asked for help and a self-righteous go at people in trouble might help your ego but not achieve much else.