Being caught for not asking for Consent To Let

rtho782

The biggest issue with no CTL in my opinion is that it weakens your position with the tenant. If you annoy/upset/evict the tenant, they can dob you in to the mortgage company and you can be royally screwed, so you have to live your life walking on egg shells around the tenant.

thesaint

marksoton wrote: »

Rubbish. A prohibition notice can be served immediately.

Lots of things "can" be done, but in the real world, you get weeks to get things done.

BobQ

Fean0r wrote: »

As said in a later post, they could either refuse - or, more likely, allow it for 1-2 years and then ask you to switch to BTL. But if you then have to come back after 3 years, you'd have to remortgage again as you can't live in a BTL property you own.

But not letting it will also result in invalidated insurance as it'd be standing empty too long.

Yes but all of that applies only when you decide to let. Asking for permission might cost a fee but there is no risk if you then decide not to actually let.

mel48rose

Why would anyone take the risk? :eek:

kingstreet

Lloyds Banking Group regularly audits the records of all its group companies looking for anomalies in residence/account records;-

Cheltenham & Gloucester
TSB
Scottish Widows Bank
Intelligent Finance
Lloyds Bank
Black Horse
Clerical Medical
Bank Of Scotland
The Mortgage Business
Scottish Widows Protection & Investments
Halifax
BM Solutions.

You'd be surprised at the number of people who have multiple accounts with these firms without realising they are all one and the same and having a different address sets the alarm bells ringing.

csgohan4

Fean0r wrote: »

Are there any real examples of anyone being caught for not getting Consent To Let?

I know everyone asks whether they need it. I know you do, and that the advise is not to risk not getting it.

But in some cases you're taking a risk just by asking for it. But, frankly, I doubt anyone's ever caught unless they're really daft. So I'd be curious to know if anyone knows of any stories.

OP is this a joke?


I can't wait for you to post on here for being investigated for fraud by HMRC and Lenders

Fean0r

csgohan4 wrote: »

OP is this a joke?

I can't wait for you to post on here for being investigated for fraud by HMRC and Lenders

Jesus wept. No, it's not a joke. Why is there always at least one person on any forum who feels the need to get on their high horse?

Don't be absurd about HMRC. They don't care as long as I declare all earnings and pay my taxes on them.

The risk regarding lenders is exactly what I'm trying to determine - but I very much doubt it'd be classed as "fraud". I'd be breaching the agreement - but breaching an agreement isn't necessarily fraud. I could be wrong about that - but I'm not a legal expert; nor, I very much doubt, are you.

It's clear from a cursory search online that a lot of landlords with residential mortgages don't get CTL. Even HSBC, when I asked them the other day, said that most people probably don't bother to ask for permission (they said their policy is only to give CTL for 12 months and that they wouldn't extend).

And there's evidence that just asking for CTL can put you in an impossible position. Google "Consent to let" and look at the second result, from Property118 (MSE won't let me post links).

Fean0r

mel48rose wrote: »

Why would anyone take the risk? :eek:

Why does anyone take the risk of torrenting movies & music? The penalties are severe and the risks clearly demonstrated in a number of high profile cases.

silvercar

The risk regarding lenders is exactly what I'm trying to determine - but I very much doubt it'd be classed as "fraud". I'd be breaching the agreement - but breaching an agreement isn't necessarily fraud. I could be wrong about that - but I'm not a legal expert; nor, I very much doubt, are you.

I'm not a legal expert, but I would say it splits in two.

a) to obtain a residential mortgage by applying on the basis you are living in the property and then letting it out without ever being an owner occupier would be obtaining money by deception, lying in your application and fraud.
b) letting out a property on a residential mortgage that you have lived in and legitimately obtained the mortgage would be a contractual breach of your mortgage conditions and not illegal in the sense that it is not against the law of the land.

somethingcorporate

Either do it properly or don't do it at all.

My experience from doing residential to C2L with 3 lenders (Skiptons, PO and Nationwide) is it's been nothing more than a couple of hundred quid a year in additional fees. For the sake of such a small sum why take the risk?

I have a colleague at work, a qualified accountant, who brags about getting properties on a residential mortgage and then rents them out. What is he risking? potentially his career for the sake of saving a few quid on doing things right and proper.

Ultimately, you expect the mortgage lender to abide by your agreed contract, why do you think it shouldn't apply to you? How would you feel if they started hiking the rates or unilaterally disregarding clauses to your detriment?

Who cares what the rates are of people being caught, they will be no comfort to you if YOU are that one that has their lives made considerably harder just for scrimping on doing it properly.

Also, if your tenants cannot trust you to take your mortgage obligations seriously I'd be seriously concerned what other obligations you don't think apply to you - you'll already be invalidating your insurance, what says you will take your legal and safety obligations seriously when it comes to your tenants welfare?

Good luck in what you choose.