Mortgage, help-to-buy, and letting...

indiechickuk

Hi - apologies if this is the wrong forum for this, but I'm hoping someone can advise...
My husband owns a house which he bought with Help-to-buy 2 years ago. He's not quite at the point of being able to buy himself out of it, and is now reaching the end of his initial 2 year mortgage deal.
I also own a house (we each bought these properties before we met), which we live in; our mortgages are separate, and in each of our names individually.

He would like to let out his place, as we don't live there, but we're not sure how to manage this as I don't think he'd qualify for a buy-to-let mortgage, but the alternative is we have to leave it empty until we can buy out of the help to buy AND pay off enough to qualify for a buy to let mortgage.

I've read in some places that if you've lived in a place for 2 years then your mortgage lender may allow you to let? is that correct?

Also, would it make any difference if we (on paper) merged more of our assets, so that it's a joint application instead of just him?

Hope that makes sense?!

Comms69

The lender may give consent to let, which usually lasts 12 months.


This wouldn't require a new application.


BUT do you know anything about being landlords?

indiechickuk

Comms69 wrote: »

BUT do you know anything about being landlords?

Very fair question! Whilst neither of us have previously been landlords, we've both had a great deal of experience of having landlords (good and bad), and know the score! I've even previously had to take a bad landlord to court, so am even more determined to do it well!

We've planned ahead in terms of things like insurance (my OH works in insurance anyway), the deposit scheme, making sure we've got some money set aside to cover extras, and we live and work pretty close to the property so it's not going to be too difficult to deal with issues that arise. Not expecting it to be easy, or money for nothing, but still better than leaving the house completely empty!

kingstreet

You can't normally let a property with an outstanding HTB equity loan.

https://www.myfirsthome.org.uk/iwantto/sublet/

kingstreet

indiechickuk wrote: »

I've read in some places that if you've lived in a place for 2 years then your mortgage lender may allow you to let? is that correct?

No. It isn't.

A lender may choose not to offer consent to let under any circumstances. The expired time since mortgage inception has little relevance.

indiechickuk

kingstreet wrote: »

You can't normally let a property with an outstanding HTB equity loan.

https://www.myfirsthome.org.uk/iwantto/sublet/

True - but if we can focus on paying off the HTB, and then get 'consent to let' (which I've only just learnt about ) after, as opposed to having to pay off HTB as well as getting to the 25% needed for a buy to let mortgage, it makes it a lot more achievable!

I think I get it now!

kingstreet

Check the lender's policy on CTL before you go to the expense of HTB redemption as that involves the cost of a RICS Surveyor valuation and £200 admin fee.

sal_III

Also CTL is usually temporary solution granted for several years at most. It's not a substitution to BTL mortgage.

indiechickuk

sal_III wrote: »

Also CTL is usually temporary solution granted for several years at most. It's not a substitution to BTL mortgage.

we've been doing the maths and have made a plan and a year should get us where we need to be to then switch to a BTL.

First world problems of having an 'extra' house!

Cakeguts

The only other thing you need to know is that some houses that are bought to live in make the most terrible ones to let. It doesn't follow that owner occupied houses make good rentals. People buying a house will make more compromises than someone who only wants to live there for about 6 months. If it isn't suitable as a rental expect lots of times when it is vacant, and possibly a lot of damage.