Nationwide BMR - thinking of letting house

pixiecheeks

Hi All,

Looking some advice with regards to letting your house and how this affects the mortgage.
We currently have a mortgage which is on Nationwide's Base Mortgage Rate (BMR), 2% + Bank of England base rate which works out as 2.5%.

We are looking into letting the house as we would like to move and from what we've read, Nationwide as part of the letting arrangements adds 1.5% interest to whatever rate you are on. My question is, if we then decide to stop renting out the house, would our rate go back to the BMR or would Nationwide class this as a change in our product and make us go onto to their less competitive SVR of 3.99%? I know from the news stories and the like that I have read that Nationwide are keen to get customers off the BMR as it is not making them money, so just worried what might happen?

Anybody have experience of letting their house in general and what interest did your bank then charge you?

saverbuyer

It looks like you move back to the product you were on. Be careful though, Nationwide could eventually insist you move to a BTL product as consent to let is at their discretion.

snowmen

Why don't you ring them on 0800 302010 and ask?

warmhands.coldheart

or do what a lot of others do and say nothing and just move. It's what we did and numerous others I know. at the end of the day, as long as they get their payments I'm sure they are not bothered.... House Insurance on the other hand is required to be Landlords/Rental insurance....

saverbuyer

warmhands.coldheart wrote: »

or do what a lot of others do and say nothing and just move. It's what we did and numerous others I know. at the end of the day, as long as they get their payments I'm sure they are not bothered.... House Insurance on the other hand is required to be Landlords/Rental insurance....

Potentially a disaster. A) Its mortgage fraud and insurance could be invalid as you don't have lenders consent to rent their property.

It’s a relevant charge for the increased risk to the lender as you’re running a business.

Having said that, I know others who are doing the same thing. Makes me wonder though, if they are happy to defraud their lender what other things are they happy to forget about? Tax returns, gas certificate, insurance etc.

warmhands.coldheart

saverbuyer wrote: »

Potentially a disaster. A) Its mortgage fraud and insurance could be invalid as you don't have lenders consent to rent their property.

It’s a relevant charge for the increased risk to the lender as you’re running a business.

Having said that, I know others who are doing the same thing. Makes me wonder though, if they are happy to defraud their lender what other things are they happy to forget about? Tax returns, gas certificate, insurance etc.

Or looking at it another way, is OP happy to accept a huge increase in their mortgage interest rate and so getting shafted by the bank!!

I did this about 10 years ago with a house when buy-to-let mortgage rates were on par with normal home buyers rates. Told the mortgage company we were moving out and renting house, they "Noted" on the file that we were renting the house and charged a £150 admin charge (Bit steep for "noting" something on a file) however no change to mortgage rate... Role on a few years and those who have great deals linked to BoE base rate and what do they do........ oh you have to change to a different product and by the way it's a sh.1t lot more expensive !!!! who's the real fraudster here !!

saverbuyer

warmhands.coldheart wrote: »

Or looking at it another way, is OP happy to accept a huge increase in their mortgage interest rate and so getting shafted by the bank!!

I did this about 10 years ago with a house when buy-to-let mortgage rates were on par with normal home buyers rates. Told the mortgage company we were moving out and renting house, they "Noted" on the file that we were renting the house and charged a £150 admin charge (Bit steep for "noting" something on a file) however no change to mortgage rate... Role on a few years and those who have great deals linked to BoE base rate and what do they do........ oh you have to change to a different product and by the way it's a sh.1t lot more expensive !!!! who's the real fraudster here !!

I agree to a point but the fact remains you have a contract with the bank. BTL is higher risk so higher margins for the bank. You agreed to their terms, they gave you their money. Don’t agree, don’t sign up.

The bank aren’t really there to give you a good deal, they are there to make money.

Don't inform the bank and they have the right to break the contract and take the house.

Insurance can be invalid.

pixiecheeks

Thanks everyone for your help, was just interested to know in general if anyone had experience of a change in interest rates for letting out your house.
Checked it out with Nationwide today and we would go back to the BMR, so for once its good news!

warmhands.coldheart

pixiecheeks wrote: »

Thanks everyone for your help, was just interested to know in general if anyone had experience of a change in interest rates for letting out your house.
Checked it out with Nationwide today and we would go back to the BMR, so for once its good news!

Get that in writing, don't take their word for it... if they won't put it in writing or it's not in writing, there's no guarantee they'll stand over what they said and you'll have no comeback on it...

loobiej1

Hi

I am with Nationwide and started renting my property out April last year, i got consent to let with 6 months no change to interest rate then after 6 months we extended for the maximum 3 years and our rate has gone up 1.5%. They were a £30 application form fee.

Thanks

warmhands.coldheart

loobiej1 wrote: »

Hi

I am with Nationwide and started renting my property out April last year, i got consent to let with 6 months no change to interest rate then after 6 months we extended for the maximum 3 years and our rate has gone up 1.5%. They were a £30 application form fee.

Thanks

That would add potentially over £110/month to your repayments. For what exactly?