Questions a mortgage lender does not want us to ask

QQQ

So far talking to different mortgage lenders I learned about the following disadvantages:
1. Some will not allow to have a loan secured against the property from lender other than them. So they become a lending monopoly or I have to leave them which will cost a lot.
2. Many lenders will not let me to rent the property out if I will ever relocate for a better job. (by the way, what enforcement do they have to prevent renting the property out provided I keep up with all mortgage repayments?)
3. Some want me to have my current account with direct debits with them. I do not mind as long as their customer service is OK.

Are there any other questions to ask a mortgage lender upfront when I am shopping for a new one?

Radiantsoul

If you want to rent out the property you have to let them know and they will have to agree - most likely increasing the mortgage interest rate as there is additional risk. Failure to do so is fraud. You also need to insure as a landlord.

dimbo61

You want to borrow the money and they make the rules !!

StuC75

1 - They want to ensure sufficient equity incase they have to repossess & sell on.. If you owe more than its worth then its not sufficient security to secure on the property. Mortgage being the primary charge as its the bigger amount..

2 - Banks out to make a profit - often 'graded' to match the risk to them..

3 - Anything you 'have' to take should be detailed in the KFI \ Mortgage offer that you are given - usually will only just advise of insurance needs and that they would be happy to try and sell you anything that you need.

QQQ wrote: »

So far talking to different mortgage lenders I learned about the following disadvantages:
1. Some will not allow to have a loan secured against the property from lender other than them. So they become a lending monopoly or I have to leave them which will cost a lot.
2. Many lenders will not let me to rent the property out if I will ever relocate for a better job. (by the way, what enforcement do they have to prevent renting the property out provided I keep up with all mortgage repayments?)
3. Some want me to have my current account with direct debits with them. I do not mind as long as their customer service is OK.

Are there any other questions to ask a mortgage lender upfront when I am shopping for a new one?

Thrugelmir

QQQ wrote: »

Are there any other questions to ask a mortgage lender upfront when I am shopping for a new one?

The important ones perhaps. Such as what's the best interest rate you can offer me.

mrginge

Radiantsoul wrote: »

Failure to do so is fraud.

Well, it isn't is it.

But it would most likely be against the terms of your mortgage.

gazter

mrginge wrote: »

Well, it isn't is it.

But it would most likely be against the terms of your mortgage.

I have read numerous stories of borrowers getting stung by banks for non residential rates as a result of renting out.

I would imagine the lost revenue (as seen by the banks) is something that, as the operating margins of banks tighten, they would actively pursue.

What would be the means by which a lender would find out that an owner was letting out?

Do they have free lancers who work on commission to uncover? I couldnt imagine tenants could care less, why would they 'shop' their landlord in, or even know?

opinions4u

gazter wrote: »

I have read numerous stories of borrowers getting stung by banks for non residential rates as a result of renting out.

I would imagine the lost revenue (as seen by the banks) is something that, as the operating margins of banks tighten, they would actively pursue.

What would be the means by which a lender would find out that an owner was letting out?

Do they have free lancers who work on commission to uncover? I couldnt imagine tenants could care less, why would they 'shop' their landlord in, or even know?

Returned mail is the most common trigger.

Thrugelmir

gazter wrote: »

I have read numerous stories of borrowers getting stung by banks for non residential rates as a result of renting out.

That's because the lending is now on a non residential basis and the borrower is running a business.

dimbo61

The interest the Landlord pays on his/her BTL mortgage is tax deductible from the profit of renting ( If you declare your rental income)
You are running a business not living in your own home

Dave_the_Ginger_Cat

Thrugelmir wrote: »

That's because the lending is now on a non residential basis and the borrower is running a business.

And because the bank is taking a bigger risk in lending you the money for a BTL than residential