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Original poster

Informing Mortgage Lender about renting out propert DH and I disagree

39 replies

Rentahoose · 01/11/2013 21:24

We are currently unable to sell our property and as we are severely overcrowded we are going to rent out our house once we have bought out a new property.

DH doesn't want to tell lender as he says a buy to let mortgage will be much more expensive and we won't be making much money on the rental anyway (after repairs and agency fees).

I've read that some mortgage lenders are happy to grant permission to let mortgages and will charge a fee rather than put you onto a new mortgage rate.

I would rather play it straight because I don't want the mortgage company to repossess our house (which they can do if they find out) or to find out our insurance is invalid if anything happens to the house.

Also I do not want to stay on the electoral and get our post forwarded. I feel we should be able to enjoy living in our new house without all this cloak and dagger stuff.

DH view is that the only person being hurt is the bank and they're quids in anyway. He says loads of landlords do this but I am not comfortable with it.

I know this isn't an imprisonable offence but I feel if he and I disagree over it and he refuses to tell lender then he should be prepared to take on the entire risk.

OP posts:
Original poster
Rentahoose · 01/11/2013 22:17

Thanks AandAmom, that is helpful and reassuring. I will call them.

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BananaPie · 01/11/2013 22:39

Our mortgage provider charged us an extra 1% to let . To be honest, I think we would have got away without telling them - all they care about really is whether it's being paid every month. I don't think they'd check whether you're still on the electoral role, and you can renew mail forwarding at the post office each year (it's not just for 12 months). That said, I'm not sorry that we did the honest thing and told them!

BananaPie · 01/11/2013 22:40

Roll not role!

AandAmom · 01/11/2013 22:40

No worries, good luck with everything.

Crutchlow35 · 03/11/2013 09:03

And please make sure you get malicious damage cover with your insurance. Don't cut corners on that. If the property is damaged by your tenants them you need this.

specialsubject · 03/11/2013 10:15

back to this thread a bit late - sorry OP, I thought it was you wanted to defraud, I see now it isn't.

you can renew forwarding at the post office after the first 12 months BUT they WILL refuse beyond that. It's in the ts and cs.

anyway, hopefully your husband has now realised that fraud here would just make extra work (as well as risking all the things listed) and it would actually be easier to do things properly.

Original poster
Rentahoose · 03/11/2013 19:18

No problems Specialsubject I appreciate you posting again.

We are not going to be forwarding mail or staying on electoral role.

I've been talking to Dh about it. Our case has actually become a bit more complicated. Apparently his IFA and other "experts"(including a housing officer) have been telling him to do this.

I think we could get permission to let quite easily if we tell mortgage company but because another party has a share in our home it becomes more complex. If we had managed to sell we would have paid them back but at present can't sell. If they pull out now we will have to stay where we are and overcrowding is causing huge stress.

Unfortunately we are in negative equity as bought when prices were high.

I will fight to do the right thing though

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ShoeWhore · 03/11/2013 20:40

I don't think there's anything to stop you calling your current lender for a theoretical chat about letting the house is there? I think it very much depends on the lender and their attitude to buy to let tbh.

You can offset interest payments (but not the repayment bit of the monthly payments) against the income, which reduces your liability for tax.

Gobbolinothewitchscat · 03/11/2013 21:05

Don't bother fighting to do the "right thing" - just call the lender

Either the IFA is completely incompetent or your DP is lying to you. No competent IFA would state that and who the fuck's this "housing officer"?

Your mortgage conditions are quite clear on this - I know as DH and I have two flats we rent out

I would call the IFA tomorrow and advise that yiu are very concerned about the advice that he has given DH re this. He may refuse to discuss the situation with you if his only client is DH and not you both. In that case, you need to speak to DH and say you both need to have a call with the IFA to clarify. If DH doesn't agree, then say you will need to make a complaint to the IFA's firm as he is clearly talking bollocks. Lay it on thick with DH that he is potentially putting this IFA in a very stressful and career compromising situation so is he absolutely sure that this is what the IFA said. I'm pretty sure that unless DH is a complete twunt, he'll crack and admit he's been talking shit.

Then you have to have a good think about the situation generally. It's up to you if you can carry on a relationship with such a silly sod.

Gobbolinothewitchscat · 03/11/2013 21:10

Who is this "other party"? Is it shared ownership?

If so, the conditions of that agreement may prevent you from renting out the house. For God's sake don't do it if it means you forfeit ownership of your share and, again, if the IFA is telling you not to tell them then, again, he is a bloody idiot too

Frankly, I'd get all your papers together and go and see a property lawyer

Original poster
Rentahoose · 03/11/2013 21:14

The housing officer is a friend (so was speaking in a non official capacity) who said she would tell landlords to get permission to let but in the current climate if we tell then the keyworker loan (third party) would be taken back (although we can't get hold of them by phone maybe because the scheme no longer exists) and we would be unable to move.

I have the name of the IFA mortgage advisor (don't know if off the record). He arranged the new mortgage though.

If it falls through and we remain in house what are our chances of getting a council house (none I presume).

Unfortunately we live in an area where house prices are near London prices but salaries are not.

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Original poster
Rentahoose · 03/11/2013 21:21

Sorry I mean I'm obviously not expecting to get a council house. I have a house. I mean we would be classed as overcrowded by the council and put on list for bigger house.

Maybe we need to look into extending.

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ivykaty44 · 03/11/2013 21:35

Is your name on the mortgage as well? As if so you will also be committing fraud, possibly go and look at the risks involve for fraud and then make up your mind

Original poster
Rentahoose · 03/11/2013 21:39

ivykaty44

It is but I've been thinking of taking my name off the mortgage

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