Help with renting

PeterJohnson

Hi there

We are thinking about renting our property out for maybe a year as we have run out of room and we can not sell it due to the market conditions. This means we will have to rent elsewhere as we can not afford to buy another property until the one we are in is sold.

My question is we have an interest only mortgage with the Bank of Scotland, what is the procedure to follow in notifiying them?

Are we likely to get permission? if so will we be charged? We will not be charging more than the mortgage we just want the rent to cover the repayment.

I am no expert in this so was hoping you guys could help.

Thanks so much

runninglea

you will need to get permission from your lender and maybe a cost of £250 to transfer if they let you.

You are on interest only but only charging rent to cover this - I don't understand, you need to charge the market rent as you will have various expenses to cover as well as the mortgage.

These include

- management fees unless letting yourself
- gas safety certificates
- repairs when something goes wrong

Even if you are not making a profit you will need to declare the income on a self assessment return.

PeterJohnson

Thank you for your help runninglea,

Yes I understand all of the requirements, you are right in the fact we need to cover our costs (insurance, maintainence, problems etc). We are going to look at this I should explained better and said after all the costs! What I meant is basically we aren't looking to make money on the property, we are just so desperate to get out but do not know of any other way of doing so . . .We think this is the only way out . .
If we try to rent the property, Is it likely BOS will let us? Is there a criteria that decides whether it is yes or no?

If anyone has any other ideas of a way out, let me know !!

runninglea

They could look at LTV of your current house and also your income/ expenditure position.

I know you will be receiving rent but they may not include your rent as worst case the rent is not paid over to you, then can you afford the repayments as well as all your own living expenditure.

Just need to speak to BoS and ask them.