Consent to let

SpiderElectron

I jointly own a property with a mortgage with my ex-wife. We divorced two years ago and as part of our settlement I got the house, and my ex-wife agreed that I would work towards removing her from the mortgage and deeds. I really don't want to sell the house, and would rather keep it as a long term investment.

I have a repayment mortgage with Woolwich.

I am self employed with less than 1 years accounts so far. I earn a decent living and I have never missed a mortgage payment.

I'm now married again and my new wife owns her home outright without a mortgage. I have a daughter from my first marriage and three step-daughters from my new marriage.

If I move into my wife's house, that leaves my house empty and unoccupied, so I would like to be able to let others live there but not necessarily charge a rent. For example my 20 year old step-daughter, or friends and family.

What's the best thing for me to do? Should I ask the mortgage company for a 'consent to let' even if I'm not charging rent? Is it OK for friends and family to stay there instead of me? What do I tell the mortgage company?

Thinking in the long term, whats the best way to get my ex-wife's name off the mortgage and deeds when I'm self employed with less than 1 years accounts?

I should say, I am 45 Years old, the mortgage account current stands at £126,000 and the property is worth £140,000 to £150,000.

Thrugelmir

If you move in with your new partner. Then it's a good opportunity to sell up and cut your ties with the past. Resolves a number of issues simulateneously.

SpiderElectron

Thrugelmir wrote: »

If you move in with your new partner. Then it's a good opportunity to sell up and cut your ties with the past. Resolves a number of issues simulateneously.

Yes, that's true, but I'd rather hold onto the house as a long term investment. There is no acrimony between me and my ex-wife.

kingstreet

To retain the property alone, you would need to be able to demonstrate to the lender that you can afford it alone, then they may permit a transfer of equity.

Your ex will need to agree and be prepared to sign the transfer document, once approved by the lender.

The cost of a typical TofE is £400 to £600.

Ask your lender if it requires you to have consent to let if a family member is to live in the property. I suspect not. However, you will need advice from your insurer, as the property will cease being owner-occupied, although some insurers won't be too concerned if a family member is resident.

Check.

SpiderElectron

Thanks, Kingstreet.
My ex has already agreed to allow a Transfer of Equity (I didn't know that was what it was called, though).
I don't mind putting the proper insurance and everything in place. It currently has typical buildings & contents insurance policies.

How do you think the mortgage company would react if it was a family friend, rather than relative staying there?

Foxy-Stoat_3

Your lender will need to see you are collecting rent at at least 25% more than the mortgage, as well as you meeting an other requirements, minimum LTV% etc for them to permit to consent to let, well that's what Halifax insisted on anyway.

SpiderElectron

Foxy-Stoat wrote: »

Your lender will need to see you are collecting rent at at least 25% more than the mortgage, as well as you meeting an other requirements, minimum LTV% etc for them to permit to consent to let, well that's what Halifax insisted on anyway.

That sounds more like buy-to-let than consent-to-let, so I'm surprised.

Foxy-Stoat_3

The lender will need to be comfortable that you will have enough of a cash cushion for repairs, voids and additional costs. The chap in the branch said that if the LTV is too high they don't agree to consent to let.

Thrugelmir

SpiderElectron wrote: »

Yes, that's true, but I'd rather hold onto the house as a long term investment. There is no acrimony between me and my ex-wife.

As long as your ex is named on the mortgage and deeds then she "owns" some of your investment.

SpiderElectron

Thrugelmir wrote: »

As long as your ex is named on the mortgage and deeds then she "owns" some of your investment.

Yes, I know that.
In my original post I said there were two things I want to do:
1. Get consent to let, to friends and family, with no rent.
2. Get my ex-wives name off the mortgage/deeds.

Foxy-Stoat_3

SpiderElectron wrote: »

Yes, I know that.
In my original post I said there were two things I want to do:
1. Get consent to let, to friends and family, with no rent.
2. Get my ex-wives name off the mortgage/deeds.

You may find it difficult to let without charging rent.