Letting out a property on a residential mortgage

LaMaisonDerriere

I'm a first-time buyer and looking at purchasing a property in the near future. Ideally, I'd like to let the property out and, in order to get onto the market a little easier, I want to take out a residential mortgage due to the smaller deposit and lower interest rates.

I'm aware this is a little shady and is not what you're supposed to do. However, I'm just looking for some realistic advice on this. Those that have done this before – do you have any advice? What's the worst that could happen if the lender was to find out? Could this affect my ability to get a mortgage in the future if the lender was to recall the mortgage? Is this even a possibility?

Obviously I'd be looking to apply for consent to let, but would like to get tenants in the property as soon as possible and I'm concerned what the lender would think if I was to apply for this too soon. Also, is there usually a time period after which it is acceptable to apply for consent to let? If I was to move in to the property and then apply after a month or so, what are my chances of getting consent to let?

Thanks for your time.

mrginge

LaMaisonDerriere wrote: »

If I was to move in to the property and then apply after a month or so, what are my chances of getting consent to let?

Probably zero.

minimike2

Interestingly enough I know of a client who completed on a resi remortgage and immediately got consent to let on it. I spoke to an advisor at the lender who said it shouldnt be possible, yet somehow they managed to do it.

They initially came to us to complete this transaction plus a buy to let remo and a further resi purchase. We did the resi purchase and BTL remo but refused the resi-come-btl application on the grounds of what he wanted to do. He assured us he could get this consent to let straight after so we waited and sure enough was able to prove it. Crazy.

Anyhow, OP - Simple answer is you will be committing mortgage fraud as you will be misrepresenting. You do not want to start on that slippery slope. Just get the idea out your head now. Oh - mortgage fraud, in some cases, can result in a fine and a custodial sentence. Depends on how juicy the CPS think it is. Not saying that would be the case for this scenario, but it is a criminal offence.

MerrilyA

Have you explored getting a buy to let mortgage? Loan to value and interest rates are not bad if you have a good broker to shop around for you.

I believe there are 75%, 80% even 85% ltv products and various interest rates (some fixed for a few years with fees).

All you have to do is ensure rents cover the cost of the mortgage and other costs related to renting.

You can change to a residential mortgage when you need to. There's no need to rush and risk things unnecessarily.

Speak with a good mortgage broker.

Thrugelmir

LaMaisonDerriere wrote: »

Obviously I'd be looking to apply for consent to let, but would like to get tenants in the property as soon as possible and I'm concerned what the lender would think if I was to apply for this too soon. Also, is there usually a time period after which it is acceptable to apply for consent to let? If I was to move in to the property and then apply after a month or so, what are my chances of getting consent to let?

.

What grounds would you give for applying for CTL?

foxy-stoat

LaMaisonDerriere wrote: »

I'm a first-time buyer and looking at purchasing a property in the near future. Ideally, I'd like to let the property out and, in order to get onto the market a little easier, I want to take out a residential mortgage due to the smaller deposit and lower interest rates.

I'm aware this is a little shady and is not what you're supposed to do. However, I'm just looking for some realistic advice on this. Those that have done this before – do you have any advice? What's the worst that could happen if the lender was to find out? Could this affect my ability to get a mortgage in the future if the lender was to recall the mortgage? Is this even a possibility?

Obviously I'd be looking to apply for consent to let, but would like to get tenants in the property as soon as possible and I'm concerned what the lender would think if I was to apply for this too soon. Also, is there usually a time period after which it is acceptable to apply for consent to let? If I was to move in to the property and then apply after a month or so, what are my chances of getting consent to let?

Thanks for your time.

You really need to re-think your plans.

You could get CTL if you bought a property with a good deposit (20-25%), lived in it for 6 months and went to the lender and applied for CTL.

Noone in the land will advise you to commit mortgage fraud and yes it will effect you in the future, not to mention the fact that you will be trying to unlawfully let out the property to tenants.

I wish you no luck in your quest.