Mortgage Credit Check?

WorriedMortgagee

Hello - any help on this would be really appreciated!

I moved that out of my property to move in with my boyfriend a while ago and rented out my flat - I didn't inform the mortgage company (C&G) as I didn't really think about it.

I am now living on my own in a separate flat and my landlord has offered to sell it to me.

I have got far enough along with the new mortgage application (again C&G) that today I was at 2nd phone call stage: the mortgage has been offered in principle and they just need to get the valuation done, get my pay slips etc to move forward.

All along I stated that I was still living at the old flat as I was worried that the fact that I hadn't told them that I was renting it out would cause problems.

At the end of todays call, she asked again if I was living already in the new flat and again I said no.

Obviously it has now occurred to me that when they do the full credit check, it will include an electoral roll / residence check and they will see that I have been living in the new flat for 10 months.

I'm really freaking out that this will jeopardise the whole thing.

I'm wondering should I call and say that I must confess that I have been living here but didn't say so as didn't want it to affect the mortgage application? If I do that, should I just come clean about the fact that my other flat (they know I am selling it) has been rented out? Would I need to tell them that? Could I just say that my boyfriend & I were using it as a 2nd home (closer to Central London etc) until we split up?

Bit complicated but I really don't know what to do for the best!

Many many thanks in advance...

hcb42

you need to tell them the truth, as you say the electoral roll will confirm otherwise

WorriedMortgagee

hcb42 wrote: »

you need to tell them the truth, as you say the electoral roll will confirm otherwise

About the fact that I've been renting it out as well or just the fact that I've been living away from there and in the new property?

I wonder if there is a way for them to find out that I have had a tenant?

Thanks

holly_hobby

I agree ... you don't want the lender to withdraw their offer due to non-disclosure (which they have the right to do so).

The credit ref agencies do link addresses - which is why i suspect you have been asked the q if you are already living in the property to be purchased.

Should your app be rejected, and you re-apply with another lender, they may ask why your mge app didn't proceed first time (as the original credit check by this lender will be on your record), and you would be best to confess the truth, but try and paint it as a non-deliberate act (which would affect any new lenders thoughts as the relability of the info given by you in your application.)

Hope this helps

Holly

holly_hobby

WorriedMortgagee wrote: »

About the fact that I've been renting it out as well or just the fact that I've been living away from there and in the new property?

I wonder if there is a way for them to find out that I have had a tenant?

Thanks

I would just state that you have been living in the flat as a 2nd property - don't elaborate on the other one (unless they ask a direct q if you are renting it) ... there is a saying "least said best mended" - i.e only answer the questions asked (truthfully of course).

hope this helps

Holly

WorriedMortgagee

holly_hobby wrote: »

I would just state that you have been living in the flat as a 2nd property - don't elaborate on the other one (unless they ask a direct q if you are renting it) ... there is a saying "least said best mended" - i.e only answer the questions asked (truthfully of course).

hope this helps

Holly

Thanks for that - I'll speak to them tomorrow and hope that I haven't (stupidly) adversely affected the decision.

I also hope that they don't ask if I've been renting it out! I've read some things that say that they can then immediately see it as breach of contract and repossess (at worst) or ask for a backlog of interest payments (at 2nd worse)...

BoGoF

One hopes you are paying the appropriate tax on your rental income as well?

WorriedMortgagee

BoGoF wrote: »

One hopes you are paying the appropriate tax on your rental income as well?

Yes - everything else I did the right way - I filled out a tax return this year and have landlords insurance. I was just stupid enough not to get consent to let (and the letting agency didn't mention it)

holly_hobby

WorriedMortgagee wrote: »

Thanks for that - I'll speak to them tomorrow and hope that I haven't (stupidly) adversely affected the decision.

I also hope that they don't ask if I've been renting it out! I've read some things that say that they can then immediately see it as breach of contract and repossess (at worst) or ask for a backlog of interest payments (at 2nd worse)...

Tread very carefully ... yes you have been and are in breach of your mortgage contract.

If they ask if you have let it, and then inform you that they were not aware of this, you should plead ignorance (if you were ignorant of the requirement for permission of course) that you were not aware that you had to request permission and hope that it doesn't affect your current application.

The fact that you are now selling this property may prevent them taking any further action. BUT ... they MAY decide to apply, from the time you commenced letting it, the appropriate interest rate loading they apply to mges on a consent to let agreement.

Don't panic, be truthful to any q's they ask you, and keep your fingers crossed they don't well & truly take the hump !!

Hope this helps

Holly