Santander - Consent to Let

tasty_snacks

Hoping there may be something who has recently been through this process....

My 2 year fix with Santander is up in November, and we'll be at circa 70% LTV when it does so. We remortaged with Santander after 2 years with Leeds and 1 year with Chelsea. We've never let the property out during that period.

We are moving to a different part of the country in the New Year (mainly family reasons), but want to rent there first for 6-12 months before making the moving permanent (assuming it works out), and let our current home in the meantime.

I spoke with Santander yesterday, and got mixed messages over a rate change.

The chap explained that the rate would not change if we obtained consent to let now, but it would after we obtained a new fix. I questioned the logic of this but was simply told that that's the way it works. It makes no sense to me that a rate change would be applied on one start date and not another bearing in mind, under either scenario, we'd be tied to a fixed rate for a given term.

Is this usual, or was the advice incorrect???

sal_III

The logic is that if you have a compelling enough reason to move during a residential mortgage fix, the lender will give consent to let in exchange for a nominal fee.

If you want a new mortgage while the place is already rented out they will push for BTL mortgage at higher rates, rather than residential mortgage.

tasty_snacks

Thanks sal_III.

Understand the lenders' logic in wanting to charge an increased rate in additional to a fee, but couldn't understand why they would not increase the rate had I applied today (before the end of my November fix), but they intimated that they would charge an increased rate at some point next year (after I took out a new fixed rate).

sal_III

tasty_snacks wrote: »

Thanks sal_III.

Understand the lenders' logic in wanting to charge an increased rate in additional to a fee, but couldn't understand why they would not increase the rate had I applied today (before the end of my November fix), but they intimated that they would charge an increased rate at some point next year (after I took out a new fixed rate).

They can't increase the rate mid-term, all they can do is charge you a fee for the consent to let. You are not getting a new mortgage.

muhandis

I don't know about Santander but for a Nationwide mortgage, when we got a CTL, they added on a 1% surcharge after 6 months. We were on a 1.24% 2 year fix and it jumped to 2.24%.

Once on a CTL, you are no longer allowed to switch products so when the fix ends, you fall on to the SVR unless you remortgage to another lender.

tasty_snacks wrote: »

Thanks sal_III.

Understand the lenders' logic in wanting to charge an increased rate in additional to a fee, but couldn't understand why they would not increase the rate had I applied today (before the end of my November fix), but they intimated that they would charge an increased rate at some point next year (after I took out a new fixed rate).

tasty_snacks

Good info, thanks