Letting out a flat

83dons

I currently have 15 years left to pay off about 60% of my flat. I would like to take on a second mortgage for a house but don't want to have to sell my flat. I could afford to pay both mortgages from my salary. I thought I could let out my flat though to cover the mortgage cost on it. Can I do this without telling the flat lender as long as I guarantee the monthly payment myself should I not have a tenant? I don't really want tied up with an expensive buy to let mortgage on it. What are my options here?

davidmcn

83dons wrote: »

Can I do this without telling the flat lender

No, because you've almost certainly signed up to a mortgage which requires you to live in the flat. If you can't afford a BTL mortgage then it sounds like you can't afford to carry out your plan.

AnotherJoe

83dons wrote: »

I currently have 15 years left to pay off about 60% of my flat. I would like to take on a second mortgage for a house but don't want to have to sell my flat. I could afford to pay both mortgages from my salary. I thought I could let out my flat though to cover the mortgage cost on it. Can I do this without telling the flat lender as long as I guarantee the monthly payment myself should I not have a tenant? I don't really want tied up with an expensive buy to let mortgage on it. What are my options here?

Lying or taking out an expensive buy to let mortgage.

Why don't you want to sell your flat ? You get the hassle and risk of tenants, pay additional tax, havea bigger mortgage on your new house than otherwise and have a large chunk of your assets tied up in an illiquid asset with ongoing costs.

83dons

So best to just overpay the current mortgage and get it paid off then look to rent it out and buy a new house myself perhaps?

My current mortgage with santander says the following regarding avoiding overpayment charges not sure I understand how to work out how much I can too up repayments each month?

No ERC
Santander fixed rate Overpay up to 10% of your outstanding balance each calendar year (January to December) with no early repayment charge

Pixie5740

Why don't you just ask Santander for Consent to Let? Mind you, if you think that you can't afford a more expensive mortgage how will you afford the Additional Dwelling Supplement on your next purchase?

AnotherJoe

83dons wrote: »

So best to just overpay the current mortgage and get it paid off then look to rent it out and buy a new house myself perhaps?

My current mortgage with santander says the following regarding avoiding overpayment charges not sure I understand how to work out how much I can too up repayments each month?

No ERC
Santander fixed rate Overpay up to 10% of your outstanding balance each calendar year (January to December) with no early repayment charge

That still leaves you with hassle, risk, managing tenants, a bigger residential mortgage, additional tax immediately and when you sell. BTL I should no longer teh road to riches it was 20 or 30 years ago. Do the maths first

Have you actually done the maths ?

csgohan4

Another LL wannabee

Do the maths and see exactly does it make financial sense. Are you aware of the tax and legal implication of renting out?

https://forums.moneysavingexpert.com/discussion/5896992/evicting-tenants-via-court-and-bailiffs

having tenants not paying rent is also a very real risk