Using LISA for home then renting it out?

monkeyman613

Hi All,

I'm curious if anyone has or knows anyone who has used LISA for their home and then decided to rent it out instead?

I'd assume one would use a residential mortgage to buy the property and then either get a Consent to Let from the lender or transfer to a new (BTL?) mortgage?

How long did they end up living in the property before renting it out?

Many thanks,

wjr4

monkeyman613 said:

Hi All,

I'm curious if anyone has or knows anyone who has used LISA for their home and then decided to rent it out instead?

I'd assume one would use a residential mortgage to buy the property and then either get a Consent to Let from the lender or transfer to a new (BTL?) mortgage?

How long did they end up living in the property before renting it out?

Many thanks,

That’s not the point of LISAs…

Bookworm225

there is nothing in law to stop you subsequently letting a property genuinely purchased with the intention of living in it at the time of using the LISA for its purchase

the real issue may be more practical, your assumption of getting consent to let may not be as easy as you seem to think. Converting to a BTL mortgage may be "easier" if your numbers meet the criteria for such

Green_hopeful

There is a blog on this point. https://blog.moneysavingexpert.com/2016/04/can-you-rent-out-a-home-bought-with-a-help-to-buy-isalifetime-isa/?_gl=1*1m7lid6*FPAU*Mjc1Nzg3MTc0LjE3NDQxMzE4NDY.*_ga*MTE0Njg1MjE3Ny4xNzM5MDQyNjU3*_ga_X74CWQS9F0*czE3NDQ4NzMxODckbzI5NSRnMSR0MTc0NDg3NDkxNCRqMCRsMCRoMTQyMTA5NjkwMA..

monkeyman613

Bookworm225 said:

there is nothing in law to stop you subsequently letting a property genuinely purchased with the intention of living in it at the time of using the LISA for its purchase

the real issue may be more practical, your assumption of getting consent to let may not be as easy as you seem to think. Converting to a BTL mortgage may be "easier" if your numbers meet the criteria for such

Thanks for your reply,
This is exactly what I'm trying to get more colour on. What makes you think it'd be difficult to get "consent to let", and isn't that temporary anyway, so wouldn't switching mortage be necessary eventually anyways?

Can you elaborate pls what you mean by numbers meeting criteria? Do you think buying a more rundown property and then refurbishing it, will improve the numbers/likelihood of getting a BTL mortgage?

Many thanks

Bookworm225

monkeyman613 said:

Bookworm225 said:

there is nothing in law to stop you subsequently letting a property genuinely purchased with the intention of living in it at the time of using the LISA for its purchase

the real issue may be more practical, your assumption of getting consent to let may not be as easy as you seem to think. Converting to a BTL mortgage may be "easier" if your numbers meet the criteria for such

Thanks for your reply,
This is exactly what I'm trying to get more colour on. What makes you think it'd be difficult to get "consent to let", and isn't that temporary anyway, so wouldn't switching mortage be necessary eventually anyways?

Can you elaborate pls what you mean by numbers meeting criteria? Do you think buying a more rundown property and then refurbishing it, will improve the numbers/likelihood of getting a BTL mortgage?

Many thanks

because we cannot know what is the attitude of the lender you go for.

CTL is normally be time limited, but not necessarily with an end date, eg: Halifax allow rolling 12 month periods with a decision to renew every 12 mo0nths 

as far as i know each does have at least basic info on their stance re CTL, but factors that influence it are: how soon after purchase did you ask? Lenders may view a "quick" request as an attempt at evading the BTL loan's higher rate and different lending criteria 

 here, for example, is the Halifax's page:
Halifax | Mortgages | Can I rent out my home

re BTL you are asking simple questions requiring factual answers you can get from your own research rather than us writing it out for you.
The basic criteria are usually:
- should (must) own another property which is being used as the main home
- rental income should (must) cover the loan interest by some % margin (well) in excess of 100%
- higher deposit (ie equity) required in the property, typically max size of loan capped at 75%

use one or more of the comparison websites to get illustrations of BTL loans so you get a more detailed idea