Okavango

With the present climate I guess there are plenty of people travelling who can't sell and renting out existing properties back in th UK. What is typical with mortgage lenders? Do you have to change to a Buy to Let product?

JAJ

http://britishexpats.com/wiki/House_in_UK-Keep_or_Sell

You may well find the interest rate on your mortgage is surcharged. And there is no such thing as "can't sell" - everything will sell if priced at what the market is willing to pay.

Okavango

Thanks. What you need to understand while moderating (I assume from Australia), is that first time buyers have currently been taken out of the market due to lack of 90% deposit deals in the UK. This means that it is hard to sell, though if someone was to follow your advice and firesell at an acceptable price then that would be foolhardy to say the least. While we await financial markets to find their feet then rental is the way to go, particularly as this effect has strengthened the rental market.

Now - back to the topic at hand. The particular bit I'm interested in is "If you have a mortgage on your UK property, your lender will probably surcharge your mortgage interest rate and/or charge you for "consent" to let the property." Does anyone have first hand experience of what this surcharge might be expected to be?

Mr Kilt

We rented our house out due to the price for selling being far to low. I contacted the mortgage company and they wanted to change my product which would have cost an arm and leg. What I done was made sure I had landlord insurance that was independent from the mortgage. That way if anything happened we would be insured and just carried on paying the normal mortgage. I am sure there is something against this in your mortgage policy but in fact as long as the mortgage is paid and you are fully covered do they care/know?

Not saying this is right or wrong but it is what we did and it worked out well. I would also defo recommend having an agent handling the let. Being aborad when something goes wrong:fingers is a pain in the ar#se. Good luck.

Alfresco

We are changing over to an interest only mortgage ( today). The repayments will be less than half of our current repayment. The rental income will more than cover the IO repayment.

If we do this for a year or two and the £ recovers somewhat or improves, then we may sell later down the line.

Since we don't have to sell in order to have money in Oz, as we have money from another house sale in South Africa to see us through, I'm not gonna sell my UK house at a lower value to some schmuck just because of a recession.

Our current lender Northern Sand (rock) refused to allow us to rent out the property while with them, basically forcing us to remortgage with another lender.

silver

We switched mortgage to buy to let with the same lender (prior to the GFC) - no fees - rate wasn't as good but still pretty good - its a bit of hassle but all in all a good move... Good luck with it...

Bermudashorts

I am also a bit tired about these lecturers about how every house will sell if the price is right. Of course I could sell my house tomorrow if I wanted to and was prepared to drop the price to GBP10k. The reality is it would be financial suicide to do so and thus I "can't" sell. Let's not quibble over the use of the word can't.

To the question, it would appear that it depends upon the lender. I sounded mine out and they initially told me that they do not even do buy to let and I would have to change provider never mind product. I am on a super duper tracker rate and didn't want to move off it, especially as if we decided to come home we would never get back on it. The credit department then agreed to let me keep my mortgage if the move was temporary, and as we could have moved here and hated it, I told them it was. That was a person making a decision based on my banking history with them, not a clear bank policy as such.

Alfresco

Yep me too! I could sell my house today for 1K and get loads of buyers! But I won't.

Interesting that you told them it could be a temp move etc... I never thought of that tack.

Our new mortgage is finally with the review panel, so hopefully we'll know early next week.

shella_n

we have let out house house (3 months ago) and are currently in Adelaide.

our mortgage was with HSBC and they allowed us to rent it out with no charges whatsoever! I have heard that some banks charge you a couple of hundred pounds to give you the consent to let on your current mortgage but HSBC charged us nothing.

The conssent lasts for a year and then in a years time we apply again but they said its merely formaility and the consent will be granted again.

Best move we ever made renting out the house and not selling, now we are here its so nice to know its still there and we have that safety net.

Good luck to you

Michelle

JAJ

I hope you're not seriously trying to tell us your house is only worth GBP10k. It's worth what the market will pay for it. Now some people may well decide to hold on to the property in the hope it might be worth more later on, but the value today is what someone will pay for it and no more than that.

Bermudashorts

No JAJ, what I am saying is that it is getting rather tedious that everytime somebody dares to say they can't sell at the moment they get the whole lecture about how "everything will sell if you drop your price enough". It isn't helpful and WE KNOW.

JAJ

Not directed at you in particular, but I have found that many people need a reality check about the fact that their house is only worth what someone will pay for it. If they choose not to sell at that price that is their choice, but saying "can't sell" does not indicate a good understanding of how markets work.

Zenshin

Our mortgage is with Northern Rock and we had to apply for a consent to let. Initially they weren't going to approve it as we asked for an indefinite time period but they agreed on a one year term to see how we go and we need to pay off more of the house in that year before it gets reapproved. It cost £100 for the approval but considering our interest is 0.99% I am more than happy to pay it as a buy-to-let mortgage would be considerably higher. Our tenants rental fees are covering the mortgage and costs no problem.

Bermudashorts

Well I have not tried to sell and have no interest in selling so would have been surprised if it were directed at me. But perhaps "can't" is not intended quite so literally. I expect what most people mean is they "can't sell at the price they would require".

horace

I started another thread, on this board, seeking sellers in North Somerset to no avail, but perhaps those on this thread may be interested? I am a cash buyer seeking a 2 but preferably 3 bedroom property in BS22 or BS24.

If you have such a property please let me know.

h