Changing from Primary Residence to Rental - need to change mortgage?

owl36

I think I know the answer to this one but a second/third opinion would be much appreciated.

I own one property with a mortgage that was our home and primary residence. Due to work commitments I have had to move and rented a new home with the family. Plan to stay 2-3 years for my contract.

My original property is the only property I own and I still consider it to be my Home. However I want to rent it out to cover my rental costs.

I am currently on a variable rate no penalty redemption Nationwide standard Homebuyers mortgage - just out of a fixed rate .Do I have to change to a BLT even in these circumstances.

I am sure that this is a simple question but I cannot find the answer on the board

Many thanks in advance

Sammy85_2

Hi,

We had a similar issue with our house. Our mortgage was with Natwest, we called them, explained that we wanted to rent out the house and they sent us a certificate from them with their permission to rent it out. Cost around a £100 "admin charge" for the piece of paper i think, but you do need it or you'll be breaking the terms of your mortgage. You will also have to inform them of a change of address in order to get your mortgage paperwork sent to you and not your tenants! If you havent got their permission to rent it out and you change addresses they may ask questions.

bobby-boy_2

Hi I agree with sammy you need to inform your lender but you must also change your buildings insurence to a Landlords policy and this usually requires you to get an eletrical safty cert and you will also need a gas safty cert. My lender also asked for a solicitors letter stating the lease was legal. You may also have to register with your local council (Scotland only).

Shimrod

We had a similar situation with the Nationwide a few years ago. They gave permission to rent the house out for up to three years without changing the mortage - after that we had to move to a BTL mortgage. I don't recall paying any fees to get the permission, but that may well have changed.

Icey77

I had to advise the mortgage company - £100 for the "admin" and also the management company because it is a leaseheld flat, another £80 odd. The letting agents required copies of all the permission letters etc for their files before they would allow the letting to go ahead.

You'll also need to advise HMRC so that they can send you a tax return for completion in January - Not a great idea not to tell them, it's rather frowned upon :rolleyes:

The tax return is pretty easy just don't lose any bank statements, P60's, P45's, P11D's or paperwork relating to the property! I found it is easier to keep an ongoing spreadsheet of all income in the year (salary, rent, savings interest etc) and costs relating to the property to help when the time comes.