NRAM's Consent to Let Fee increase

lauraeast23

I tried to sell it and no takers, in fact hardly any viewers and no I didn't price it to try to cover the shortfall it was market value priced.

Nothing in my area was selling at the time, round the corner to me, new flats, were being built with deposit schemes and the like going on, so my market for a 1 bed being generally FTB, I couldn't compete.

Plus I don't know how long this US employment will last, I may end up having to come back to the UK, then I would have no property to live in that I have already paid 6.5 years towards.

Since then it has slipped into even more negative equity so I just have to deal with the situation, which I am,
however I am still entitled to be angry with NRAM's actions, given that all of my actions have been to ensure that they get paid every penny and on time.

drussmonkey

mrginge wrote: »

Well tbh I was more aiming it at the OP.

However, if you would like a nice pat on the back for fulfilling your contractual obligations then that's fine. However it was you who moved the goalposts, not NRAM.

Several utterly erroneous assertions in your post, so allow me to correct. The ability to avail yourself of a Consent to Let was an integral part of their mortgage offerings in the original event, so they haven't kindly 'allowed' me to change the terms of my mortgage. We've merely taken advantage of a long-standing option that was always part of the mortgage T&Cs.

Secondly, any Consent To Let requires you to state and demonstrate two things. 1) How you plan to cover the shortfall if your achievable rent doesn't match your minimum monthly payment, and 2) If your tenants suddenly stop paying, how you will cover the full minimum payment.

Only when these criteria are met and proven will a CTL be granted. These are risk-mitigating factors that are entirely unconnected with the the current LTV of the property. As in the original mortgage application, the affordability of the monthly payments is the critical factor.

NRAM remains owned by the taxpayer. Its single mandate is to wind-down and close out all of their existing mortgage accounts. They are bound to facilitate that end by any reasonable means, which would logically include relaxing any pre-existing restrictions on letting the property out, if that facilitated the aforementioned affordability of the account holder.

So, it is they who have moved the goalposts by removing the 'administration fee', which is supposed to relate to the admin overheads in approving the let, to a variable 'cost of risk' premium that is conditional only on the outstanding LTV with no other considerations.

The fee is potentially so large so as to negate any benefit of renting the property out, and damaging the affordability of the mortgage by the account holder. By any measure, this is utterly reprehensible.

mrginge

Ctl is an integral part of their offerings?

Are you quite sure about that?

Put in a complaint if you're so convinced that they're in the wrong.

Thrugelmir

mrginge wrote: »

Ctl is an integral part of their offerings?

Always at the discretion of the lender. Never integral.

mrginge

Thrugelmir wrote: »

Always at the discretion of the lender. Never integral.

Well you and I know that. OP seems to think otherwise.

Thrugelmir

drussmonkey wrote: »

The fee is potentially so large so as to negate any benefit of renting the property out, and damaging the affordability of the mortgage by the account holder. By any measure, this is utterly reprehensible.

Given many are obviously struggling to repay the capital owed. Then NRAM is merely charging a risk premium against the defaults it expects to incur.

Thrugelmir

lauraeast23 wrote: »

What do you mean by let the property go ? Sell it ?

If you are not in a position to repay the debt. Then you may well be doing little more than postponing the envitable. As without a property market recovery the downsides appear to outweigh the risk of retaining the property.

lauraeast23

Thrugelmir wrote: »

Given many are obviously struggling to repay the capital owed. Then NRAM is merely charging a risk premium against the defaults it expects to incur.

Isn't this my point though, in that last year I provided everything to them that they required to risk asses my application for the sum of a hundred pounds.

Infact I offered them more than they were asking for, I will be providing nothing different this time around, my account is still in good standing, I have still never missed a payment, my situation has not changed financially, and it's not okay for me to be angry that they could potentially charge me over a thousand pounds more to assess the same risk as before, in fact less risk being as that I am in less debt this year than last year.

If they expect default to occur then they should not agree to CTL, that should be part of their risk assesment. Not everyone can provide all the criteria that they require and I feel bad for those people stuck in that kind of situation but at the same time I still don't think it is okay for everyone else to be lumped into that same bucket.

I am repaying the debt, and when they add the CTL fee onto my mortgage my monthly payment will go up in order to make sure that I still pay off the whole amount by the end of the fixed term. I am hoping that in a few years time I may be able to start overpaying by a small amount every month, but that's the future and who knows what can happen!

drussmonkey

I echo all that laura has said there, and it's more than a little mean-spirited to imply that since her house has poor equity and she isn't in a position to repay large lump sums, she might as well give up the ghost. A poor investment can come good in the end if you hold on to it rather than giving up early. I'm glad I don't rely the opinions of forumites here to make my financial decisions.

I overpay by a decent amount every month, and always have. I don't have a lot of equity, but I'm grinding away at it and doing all I can to make the situation better. I am a dream customer who represents very, very little risk.

So yes, I am objectionable to the fee increasing more than tenfold when it's not reflection of the indivudual risk, and certainly not mine. As Laura says, everyone is being very unfairly lumped in together in this change.

shortchanged_2

lauraeast23 wrote: »

I tried to sell it and no takers, in fact hardly any viewers and no I didn't price it to try to cover the shortfall it was market value priced.
QUOTE]

It isn't market value if it hasn't sold.

If it hasn't sold it is overpriced in the current climate. Why do people find that a difficult concept to grasp.

Who told you it was market value? Estate agents?