Admin fee for permission to rent

keeperbear

Generali wrote: »

The problem is, if things go wrong (heaven forbid) and you ever get reposessed and the lender finds out that you have rented the house without permission they may decide to employ m'learned friends. Doesn't seem worth it to save 200 quid.

I just don't believe that this complex chain of events would ever happen. If I get repossessed, why do I care about anything else happening to me or my property? I would rather save the £200 and use it as an insurance policy against repossession (i.e. use it to pay my mortgage!). These fees are stupid, and if you a BTL landlord even thinking about being repossession then you should not be buying in the first place.

BobProperty

keeperbear wrote: »

I just don't believe that this complex chain of events would ever happen. If I get repossessed, why do I care about anything else happening to me or my property? I would rather save the £200 and use it as an insurance policy against repossession (i.e. use it to pay my mortgage!). These fees are stupid, and if you a BTL landlord even thinking about being repossession then you should not be buying in the first place.

I'll bet it has happened. And while they were falling out with the mortgagee over the arrears they probably went through the fine print and the legal niceties to show that they should have made an extra 0.x% on a BTL mortgage etc. etc. and took that plus all their legal fees, charges etc, out of the sale proceeds when the repossessed property sold. So "why do I care about anything else happening to me or my property"? Because if you don't cover all their costs they'll stick a CCJ on you for the missing money. Then in 10 years time when you thought they'd forgotten about it, they'll come back to enforce it. It happened in the 90's.

keeperbear

BobProperty wrote: »

I'll bet it has happened. And while they were falling out with the mortgagee over the arrears they probably went through the fine print and the legal niceties to show that they should have made an extra 0.x% on a BTL mortgage etc. etc. and took that plus all their legal fees, charges etc, out of the sale proceeds when the repossessed property sold. So "why do I care about anything else happening to me or my property"? Because if you don't cover all their costs they'll stick a CCJ on you for the missing money. Then in 10 years time when you thought they'd forgotten about it, they'll come back to enforce it. It happened in the 90's.

But as I said in my previous post, if my property gets repossessed, why do I care if they try to retrospectively charge me a fee for renting it out? I would just go bankrupt if I was repossessed.

In my opinion, pocket this fee and don't tell your mortgage lender about renting.

Dithering_Dad

Sorry, maybe it's because I'm a ditherer, but I'd pay the fee just for piece of mind. It's a bit like telling your car insurer that you always park your car in the garage (even though you know the garage is so full of junk, you coudln't fit a toy car in there) to reduce your insurance premium. Nice if you get away with it, but not so nice if your car gets vandalised on the drive at midnight and they refuse to stump up the cash!

However, I let my house out several years ago when I worked abroad for a while and didn't have to pay a fee when I informed my lender. Maybe you should ask them where in your mortgage T&Cs it says you have to pay a fee if you rent out your house?

BobProperty

Please read my previous post in full.

also

keeperbear wrote: »

You obviously tell your insurance company if you let your home. However, why bother telling your mortgage company? How exactly will they find out about a tenant? Even if they did, I doubt the 'penalty' (if there is one) would be more than these idiotic admin fees for permission to rent.

So what do you do when the mortgage company asks for proof that you have buildings insurance and wants their name on the policy as an interested party?