Much Advice Needed Please.

stormsky

My daughter has a property which is probably a few thousand in negative equity bought a few years ago on a 100% mortgage however she is now working abroad and earning a good wage she has let the property and has to pay around £ 70 per month towards the mortgage, however she has decided that when she comes home she no longer wishes to live in the property so is unsure what to do.... should she sell and and pay off the negative equity or change to a BTL also she would like at some point to purchase another property that her sister would probably live in until her return but would she have a problem getting a mortgage seeing as she is not living in this country? Sorry for the long post hope someone can offer some advice... thank you in advance. ( don't know if it makes any differance but the country she works in is not in the EU )

Jimbo1976

Firstly I don't think she could change the mortgage to a buy to let by remortgaging as she has no equity. Did she speak to her existing lender and seek consent to let the property out?

It will be harder for her to get a buy to let loan on a new property if she does sell as typically lenders have tougher criteria for ex pats. Another issue is that if she does get a BTL loan then this means she may not be able to let her sister live there as there are restrictions on family use (limited to 40%)

I think you need to speak to a mortgage broker to get some professional advice

stormsky

Hi, thank you for you'r reply no she has no permision to let the property out ( I know bad move) but at the time she had no spare cash available to change the mortgage however the situation is a lot different now, if she did not already have this property would she be able to get a normal mortgage do you think?
I can see that she is going to have to see a mortgage adviser on her next visit home just wondered what sort of options she would have.

R_P_W

You havent provided enough information to say whether she will have difficulty getting a mortgage in the future.

It is concerning that she did not get permission from her lender prior to letting her property as this probably means she has breached the T&Cs of her mortgage - something I would recommend rectifying ASAP. Depending on the lender this doesnt 100% have to cost her a signifciant amount, some lenders will provide a 'consent to let' which will mean not having to change the mortgage for 6-12 months. There will probably be a one of charge and they may decide in review the the interest rate payable though.