Getting permission from your lender to rent out your house

Pinnelli

Hi - I need to rent out my house and have been told by my bank that I need to get permission from them to rent the property out, I need to fill in a form which will cost my £100 and send it back to them. Does anyone know what happens if I don't get permission from the bank and go through the process of renting my house out anyway?

Any thoughts or advice on this would be greatly recieved.

thanks for reading!

flower_72

Hi Pinnelli,
I went through this process last year.

I believe that, should you get caught, you would have broken the conditions on which the lending was made. I suppose they could ask for full repayment of the mortgage?
I guess it's highly unlikely that 1- they find out you are renting (unless you start going into arrears and they have a closer look at what is going on) and 2- they decide to repossess in order to get the money back.
That's my understanding, anyway.
I guess there might be some insurance issues too. When I changed my building insurance from mortgagee-occupier to tenanted, they asked me if I had sought authorisation from the lender.
My personal views now: it is unlikely you will be refused consent to let your property out provided you pay the fee, you confirm that you expect to live back at the property in the short term, you have a good record with your mortgage repayments (Woolwich told me, the 6 previous months are looked at) and you expect to get enough rent to cover the mortgage. You can always ring your mortgage company to ask for an non-official opinion. I did and their reply was:" as far as we can see now, there are no reason why permission to let shouldn't be granted, but you'll have to apply to get confirmation of this."

Hope that helps.
Flo

Icey77

My letting agent required a copy of the letter giving permission from the bank before they would go ahead with letting my property to my tenants.

Gorgeous_George

If your LTV is attractive and the rent covers the mortgage, there should be no reason why they should refuse. Unless, of course, they are reducing their mortgage book.

GG