Not sure what to do..

Roland_Flagg

A couple of years ago myself and my girlfriend moved due to noisy neighbour. My girfriend's dad (who is deaf) moved into the old property, but there was no official arrangement, and at the time we did not have to declare this to get a mortgage at new house, or amend mortgage at old house.

My girlfriend's Dad covers most of the mortgage on the old house (he just gives her cash every month),
but we do not make any money from this arrangement.

Now, our mortgage deal (Santander) at new property is finishing and going up from 2.95% to 4.25%.
Mortgage at old house is just 2.5% at Nationwide due to being a
long existing customer.

Our Mortgage advisor has recommended a Woolwich mortgage
for new house, which is quite a bit less than the 4.25% on offer at
Santander, but he said they would need us to get and complete
a Permission to Let Form from Nationwide for old house.

Problem is that on this form it says the Nationwide can add 1.5%
to the mortgage at the old property.

What is the best thing to do in this situation?
We would like just to carry on as things are but get a better deal
than the 4.25% on offer from Santander, without it affecting
the mortgage on the old house.

Cheers.

Dave_Ham

Is the Nationwide mortgage interest only or repayment?

I assume your broker has checked affordability and that you cannot support the 2 mortgages from your income?

Assuming you trust your broker is experienced enough to qualify all options, then you have no alternative than to try and explain this to your OH Father or work out which one is commercially the best to take a hit on (probably the lower value one) and suffer the additional cost yourself..

Roland_Flagg

Thanks for the reply Dave.

Both mortgages are repayment.
Yes we can afford both.
The mortgage on the old house was only £48,000
to start off with about 13 years ago.
I think it has about £19,000 left.

Dave_Ham

Whilst you should not necessarily have a residential mortgage and rent to OH Father, if you can afford both (on lender affordability) I would imagine they can disregard the consent to let. You only require this in order to mitigate and offset the commitment.

If for any reason it does fall down, do remember that with OH Father paying a repayment mortgage I would suspect that whilst not profiting monthly you will benefit financially from this arrangement given the equity and that would be the banks issue as technically it is a commerical situation - probably done with the best intentions.

Maybe have another chat with your broker..

Senior_Paper_Monitor

Family member - 2nd home ?