Renting: Does LL Have a BTL Mortgage or OO?

barnaby-bear

silvercar wrote: »

Lenders could make this situation a lot easier by producing a certificate saying that owner mr X of property address Y has the correct mortgage for letting purposes or lenders consent to let. Then tenants could ask to see the certificate in the same way that they should see the gas safety certificate.

I think this is a good idea - an AST should be issued with a permission to let or owns house outright (solicitor certified) certificate to be valid - if it was made part of the legal requirement like TDS it would solve a lot of issues and perhaps clearup a few rogues/tax dodgers.

silvercar

barnaby-bear wrote: »

Yes we do because people keep insisting this can't happen. I think it's a loophole in legislation - because I don't think there should be so little comeback on rogue LLs who do this and it doesn't seem right a tenant who's paid rent can be kicked out instantly, it also sems wrong there is no criminal comeback on the LL who has in my opinion acted fraudulently. not fraudulently, not illegally, but breached a term of their mortgage. This is a civil matter between landlord and his mortgage company not a criminal matterInterestingly there do seem to be a lot of cases turning up with tenants not getting wind of it or only after repossession granted. People seem genuinely shocked tenants AST isn't valid AST is valid in all matters between tenant and landlord. Only in repossession is there a problem, even then the tenant would have redress through the courts.and I do feel for the people with kids or paid up front especially they guy on here a while back who had half an hour to sticker his belongings as his before they changed the locks. The tenants legal come back is to pursue the LL (yep the one going bankrupt or whatever)Don't confuse repossession with bankruptcy for the costs involved. Especially with recent BTLers this is an issue as a tenants I'd want to check out.I'd be more concerned about people who have let their home because they cannot afford the mortgage. Genuine BTLers would have some equity in the property.

If a landlord is facing difficulty the first thing to go will be his BTL rather than his own home. He may well have equity in his home and other assets that could be used to reimburse tenants.

MissMoneypenny

barnaby-bear wrote: »

I think this is a good idea - an AST should be issued with a permission to let or owns house outright (solicitor certified) certificate to be valid - if it was made part of the legal requirement like TDS it would solve a lot of issues and perhaps clearup a few rogues/tax dodgers.

A very good idea. I have alerted Shelter to this site already, so I'll email them about this point too. Perhaps others could do this too so this isn't missed. [EMAIL="advice@shelter.org.ukI"]advice@shelter.org.uk[/EMAIL]

[EMAIL="advice@shelter.org.ukI"]I[/EMAIL]'ll also email my MP about this. Anyone else who wants to point this out to their MP can find their MPs name and email address here
http://www.parliament.uk/directories/hciolists/alms.cfm

The tax office are target driven and after the small fishes as they easier targets, so worth contacting them too, to see what they can do about this.

silvercar

The tax office are target driven and after the small fishes as they easier targets, so worth contacting them too, to see what they can do about this.

They are already aware that new landlords could have tax to declare, though TBH the chances of making big profits on a recent purchase are small.

Also don't assume that someone who hasn't asked permission of their lender will commit a criminal offence by evading tax.

barnaby-bear

Yes we do because people keep insisting this can't happen. I think it's a loophole in legislation - because I don't think there should be so little comeback on rogue LLs who do this and it doesn't seem right a tenant who's paid rent can be kicked out instantly, it also sems wrong there is no criminal comeback on the LL who has in my opinion acted fraudulently. not fraudulently, not illegally, but breached a term of their mortgage. This is a civil matter between landlord and his mortgage company not a criminal matter


I'm not talking lender-LL fraud - I think a LL renting a house and issuing an AST in a situation where the tenants won't have tenure then that should be treated as fraud, the tenant is thinking they have a right to notice when they have an AST.... the consequences for the tenants are so severe I think this type of practice leaving families on the street potentially should be criminal...

BobProperty

barnaby-bear wrote: »

Yes we do because people keep insisting this can't happen.

What "can't happen" I'm lost with this?

barnaby-bear wrote: »

I think it's a loophole in legislation

What is this "loophole in legislation" you keep taking about?

barnaby-bear wrote: »

- because I don't think there should be so little comeback on rogue LLs who do this and it doesn't seem right a tenant who's paid rent can be kicked out instantly,

Where's the "instantly" when they are notified of the court hearings, which usually take months anyway?

barnaby-bear wrote: »

it also sems wrong there is no criminal comeback on the LL who has in my opinion acted fraudulently.

The only time it would be fraud would be if the LL let the property after the court had given a possession order.

barnaby-bear wrote: »

Interestingly there do seem to be a lot of cases turning up with tenants not getting wind of it or only after repossession granted.

The court writes to "The Occupier". If that hasn't happened then you could argue that the proper processes haven't taken place.

barnaby-bear wrote: »

People seem genuinely shocked tenants AST isn't valid and I do feel for the people with kids or paid up front especially they guy on here a while back who had half an hour to sticker his belongings as his before they changed the locks.

The AST is valid. Get it into your head there are two totally separate contracts here, one between a lender and borrower, and one between a landlord and a tenant. It just happens that the borrower is also the landlord.

barnaby-bear wrote: »

The tenants legal come back is to pursue the LL (yep the one going bankrupt or whatever) for the costs involved. Especially with recent BTLers this is an issue as a tenants I'd want to check out.

The lender has the same problem. How are you expecting to check this out as a tenant?

MissMoneypenny

BobProperty wrote: »

The only time it would be fraud would be if the LL let the property after the court had given a possession order.

That is where the law need to change, so that it is fraud if a LL gives an AST to a tenant when they didn't have permission to rent from the lender (who is also the owner of the house).

BobProperty

MissMoneypenny wrote: »

That is where the law need to change, so that it is fraud if a LL gives an AST to a tenant when they didn't have permission to rent from the lender.....

First, I think you are being overly optimistic on what you can hope to achieve by doing this. The "fraud" would only exist once the tenant has been removed from the property, so you are not preventing what I assume you are attempting to prevent.
Second, you are creating an additional obstacle and complexity in an already complex situation. How long would these "permissions" be valid for? How would they affect the landlord and tenant's privacy?
Third, how many landlords would worry about this anyway? If the situation goes so completely wrong that their property is getting repossessed they are hardly going to worry about not complying with telling their lender years ago that they have rented it out. If you take an extreme "sledgehammer / nut" approach and say that you will get 5 years inside for not getting the lenders permission, then you will get delays and additional costs all of which the tenant will end up paying for.
Even with the agreement of the lender, there is nothing to stop them from repossessing the property if the borrower defaults on the loan. This is the point I seem to have difficulty in getting across. The lender has given permission to the borrower to let the property. So what? It makes no difference whatsoever if they want to repossess the place. The tenant still gets removed.

clutton_2

no LL sets out to make folks homeless.

Sometimes life's circumstances change, illness, death, bereavement, etc and LLs can no longer afford the mortgage - we all go thru hard times sometimes, LLs are no different.

i do agree that LLs should not be doing BTL on a Residential mortgage - but as earlier pointed out - it wont make a happorth o difference to the tenant if the LL reneges on mortgage payments whether they are Resi or BTL - either way the tenant still gets evicted.

Bungarm2001

RabbitMad wrote: »

I think what you are trying to find out is whether your landlord is likely to be repossed while you are renting? Unfortunately you won't get that information from the land registry. Try asking your LL to see their mortgage contract and last annual statement and bank statements to check they are keeping up repayments. I'm sure they'll oblige you:rotfl:

Thanks for that Rabbitmad...you've just made my day if not my week!! :rotfl: :rotfl: :T

To the OP...Your being evicted eventually because your LL may or may not have a residential mortgage over the property and that they may or may not have informed their lender of their intention to let the property is about as likely as you being struck by lightening...twice.

Or winning the lottery.

Don't take too much notice of the tone of some of the posts on here. Some people pontificate about things they know nothing or very little about and blow things up out of all proportion.

ALL you need do if you are genuinely worried about this is to put your concerns in a note to your LL and I am sure he/she/they will put your mind at rest.

All the best... :beer: