Can't shift from residential to BTL

asmith29

Hello.

I hope someone please can offer some advice?

I'm the owner of a lovely little one bed flat in Basingstoke with a residential mortgage of 69k and about 50% ltv. It's currently 'consent to lease' for the last few years with Bank of Ireland and on the variable rate of 4.5% with a long term tenant who is a diamond.

I want to get onto a permanent BTL, but I have no other property and I'm finding this a problem with some lenders. I effectively house sit my sisters property in Reading for £450 a month and she has plenty of resource and is staying put in her home in her South London with no plans to sell. I can see why this situation might be a stumbling block for some lenders, but even my own won't accept me for a new deal even with eight years of no problems and a perfect history.

I work full time with a decent wage and my tenant pays way above 125% rent to mortgage.

Any thoughts?

Regards.
Al.

ACG

Speak to a broker. There will be lenders for this and at normal rates.

asmith29

Thanks. I spoke to a broker that advertised no fees and then there was a free of £500.

ACG

Theres more than 1 broker out there, I dont think many of them advertise no fees and then charge as its not allowed.

asmith29

I'm aware of that but you'll also be aware of some of their sharp practices. I can't be that miscommon.

ACG

Its a regulated industry. If you end up out of pocket because of these sharp practises you have the Financial ombudsman to fall back on.

A decent broker does not need to resort to sharp practises, you shoud be given a terms of business/Initial disclosure document (IDD) upfront which explains what fees are chargeable and when. Just read what you are given and there should be no reason to be caught out.

Also on the KFI (key facts illustration) from the lender, section 8 has the fees on there, fees to the broker and lender. So again, read that just to back up what has been said verbally.

amnblog

I think you may be fortunate to find a competent broker that will help you with this without charging a fee.

Why?

Residential to BTL on a sole property is often rejected by Lenders as they do not believe you will not move in at some point.

A broker would need to be very keen for the work to risk a lender rejection post application for potential revenue of £350.

asmith29

Yes there was a dcilosure and by that stage I'd got fed up with him and just rejected it as a route. Thanks for the background, will look to pursue.

amnblog

ACG wrote: »

Its a regulated industry. If you end up out of pocket because of these sharp practises you have the Financial ombudsman to fall back on.

A decent broker does not need to resort to sharp practises, you shoud be given a terms of business/Initial disclosure document (IDD) upfront which explains what fees are chargeable and when. Just read what you are given and there should be no reason to be caught out.

Also on the KFI (key facts illustration) from the lender, section 8 has the fees on there, fees to the broker and lender. So again, read that just to back up what has been said verbally.

We do not know if this broker was regulated ACG, there are a few in the South East that do BTL only without any regulated business at all.

ACG

I wasnt aware of that.

asmith29

I got sorted with TSB via Countrywide some months ago. Thanks for all your help.
Al.