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Mortgage company won't allow us to rent....advice?

(14 Posts)
Esssss Tue 03-Nov-15 15:28:40

Hello,

Looking for some advice. We have recently bought a property and ported our mortgage from our old house across. We have only been here just over a month and dh has been offered a job abroad that we want to take next march/April. However the mortgage company have said we have to have lived in our new property for 12 months before we could apply to rent out the house. We couldn't afford to pay the mortgage on our house as well as rent a property abroad. Is there any way around this? Surely it's better to have someone living in the house and paying rent than us living abroad and trying to pay rent from there? Does anyone have any words of advice/experiences? Thank you!

lorelei9 Tue 03-Nov-15 15:34:05

my best friend was a similar spot when she worked abroad

have they actually said you can't or have they just allocated a hefty penalty for doing so?

It would be normal for there to be trouble switching your repayment mortgage to a BTL mortgage to be honest. Do you have the paperwork from the porting? If they specified any penalties you will have to suck it up, I'm afraid. You could try changing provider but may be locked in for a specific term.

the other way to look at it is as a negotiation - say to them that you will stick with them for the time that you are contractually obliged to but then will take your business elsewhere.

Definitely dig out the paperwork showing the Ts&Cs attached to porting. I ported my mortgage to my current place and I think there was a 2 year clause about renting out.

lorelei9 Tue 03-Nov-15 15:34:26

PS my friend paid them a fee in the end, it was the only way.

Esssss Tue 03-Nov-15 15:37:58

Thanks for that, I do think it probably is in the terms and conditions but because this job has just came on the horizon, we didn't think anything of it. Our current deal is up next year at some point. Do you think we could just go to a different lender that would allow us to rent. I know btl mortgages tend to be more expensive so it's frustrating that we haven't bought the house specifically to rent out, we just need to rent it out for the next few years until we come back to the uk.

kickassangel Tue 03-Nov-15 16:04:04

I hate to say this, but the mortgage company can change the T&C whenever they want. Several years ago we were in a similar position, and had a renter ready to move in, agreement from the mortgage company in writing etc. Then they changed their policy and sent us a letter saying that we couldn't rent out the house.

You will almost definitely need a buy to let mortgage, and they can cost a significant amount more, you'd need to apply for one and get approval, then pay up your current mortgage complete with any fees to early payment.

There are mortgage brokers who specialize in mortgages for people living overseas, so that would be worth looking into. A good broker should be able to find a mortgage that works without costing you a fortune.

Also - banks are getting more wary of customers who live overseas. We live in the US and it looks like we'll have to shut down our UK accounts and move to off shore ones, which cost money.

Basically - every time you move country, and move money/mortgage etc it costs you money. I would budget for 5 - 10% of any money you have disappearing in fees, exchange rates etc. when looking into moving to another country. Also assume that there will be extra ongoing costs for things like mortgage etc.

GreenSand Tue 03-Nov-15 16:05:21

Would you be going out at the same time as DH? When we moved, due to visas, DH had to come over first. He started his job in May. I followed with the kids in August. If the job starts April, and you follow in May or June, you would be able to rent the house by October. Could you manage that?

Or yes, pay the exit penalty, and get a btl mortgage.

Gracey79 Tue 03-Nov-15 16:09:58

Who is your lender? I work for one of the big high St banks and we decline a request made within 6m to prevent people taking residential mortgages for btl purposes. Wondering if potentially if you ask nearer the time it may be different?

specialsubject Tue 03-Nov-15 16:37:43

I'm also guessing it is to stop BTL fraud with residential mortgages.

suggest first doing your sums; how much it would REALLY rent for, any licensing fees, pre-rental fixes, agent fees, ALL the insurances, storage of your furniture, maintenance etc etc etc. You may find that this doesn't fly at all and you need to sell or cannot afford to take the foreign job.

hope not - but get the full picture first!

LizzieMacQueen Tue 03-Nov-15 17:13:22

Would the firm that have offered your DH the job pay any extra costs as part of relocation? So they would have to pay your mortgage until you can rent the house out.

lorelei9 Tue 03-Nov-15 18:49:23

Lizzie makes a good point, some firms are very generous with relocation expenses. they might not pay your mortgage but they might pay towards it or pay the fee to switch to a btl mortgage.

Esss "Do you think we could just go to a different lender that would allow us to rent"

you might be able to stay with the same one and just change the type of mortgage you have. That's why I wondered if you felt you could negotiate with them, they might want the fees from the BTL.

Esssss Tue 03-Nov-15 20:18:25

Thanks so much for all your answers. It seems unfair for a mortgage company to have that much control when you try to do everything right. The cost of renting out the house is my biggest worry because while we can live fine on dh's wages at new job, it would make life very hard to have costs on house in the U.K too.

We can ask about extra money from firm - on one hand it's not really their problem so why should they fork out on the other hand if they really want my husband to come work for them they will have to make it worth our while!!

I've got some letting agents coming round next week to value the place and talk us through what we'd need to do to rent so perhaps they can shed some light on what we could do.

Coming out later than dh is a possibility, I'm due baby number 2 in January so I don't particularly fancy being on my own for most of the year but needs must I suppose!

Why is nothing ever straight forward eh!?

specialsubject Tue 03-Nov-15 20:36:04

landlords must have enough cash to cover voids and repairs, and all the right insurances. Be careful.

look on rightmove and ask around to see what it will really rent for.

kickassangel Tue 03-Nov-15 21:31:39

and your current mortgage probably insists that someone from the family is resident in the home, so you can't even move and leave it empty. I know it's hard, but the mortgage money has given you THEIR money so that means that they get to call the shots.

Esssss Tue 03-Nov-15 21:48:04

Yup, understood. Thanks everyone

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