Renting question
 

Hi everyone, we have got to the stage when we are thinking about renting out our house with it not selling.
I understand you are supposed to inform your mortgage lender that you wish to do this. Is this more of a formality or do they often say no? Why should they say no, does it happen very often? How would you find out without telling them that that is your intention? Can you actually rent it out without informing them?
Thanks very much :D

Re: Renting question
 

We were with Nationwide and they said no. We didn't inform them, the solicitor did.:thumbdown:

Re: Renting question
 

Alliance & Leicester have said yes to me on several occasions, each time charging me £125. If you have a mortgage, the bank has an interest in what happens in your/their property.

You COULD rent it out without informing them, and you CAN, but you MAY not ;) Worst case scenario....bank finds out, you are in breech of mortgage terms, they call in the loan giving you seven days' notice to pay off your mortgage.

Re: Renting question
 

We are renting ours out now without their permission. Went for an appointment to ask for a consent to let and he said we would have to change our mortgage putting the interest rate up a fair bit. While I was talking to him, he sort of said that the mortgage company never knocks on doors so how would they find out. The only problem would be that if something major went wrong and they found out then there could be trouble. We have taken out quite a hefty landlords insurance policy and have an agent on full management so hopefully will be ok for a couple of years :unsure:

Re: Renting question
 

We are renting ours out. We asked the building society and they said no problem and put us on a interest only mortgage which is great as its dropped by about £400 a month.
We told them we were moving to Australia for a few years.

Re: Renting question
 

Hi Nicky, can you tell me which landlords insurance company you have used to cover yourselves.

Thanks :thumbup:

Re: Renting question
 

Hi

We are renting our house out. Our mortgage is with Nationwide, i contacted them via letter, they sent me a form to fill in then said no problem. Our buildings insurance are also with Nationwide so i contacted that department just to inform them of the situation. I would recommend that you try to make sure you have a good letting agency as we had a crap one at first & our first lodger left the house in a right mess when they moved out. We got absolutly no back up or support from our agent. I had 4 pages of problems left by the lodger which we gave to the agents!!! We spent hours making everything right ( including a gas fire that they had tampered with & made dangerous!!!!! ) We now have an excellent agent who keep on top of everything. Hope everthing goes ok for you.

Re: Renting question
 

Hi, does your letting agent guarantee your monthly rental whilst it is rented out or do you have landlord insurance for this?

Thanks

Re: Renting question
 

Hi

Neither. We looked at some sort of landlords insurance but to be honest we decided it wasn't worth it we would just keep our fingers crossed & hope for the best :) With the first agent we had someone on 6mthly rental. 1st 6mths was fine but then he lost he job apparently & didn't pay up but the agents didn't bother to tell us until i phoned asking why we hadn't got paid that they informed me he was not paying. They hadn't even bothered to contact him by calling at the house to find out what was happening, just kept leaving messages on his phone which needless to say he ignored. This was 3 weeks after it was due!! Needless to say i blew my top & told them exactly what i thought of them ( very politely i hasten to add but they still put the phone down me :frown: ) We did eventually get all the rent owed & moved rapidly to another agent who are on the doorstep 2 days after failure to pay. Our new tenant has got a 2yr contract which they requested so it works better for us. Have had no problem with failure to pay up till now ( famous last words!!!!!! :D )

Re: Renting question
 

Have you found it easy to switch off from the UK property or is it always a worry at the back of your mind?

Re: Renting question
 

We are still in the uk. Its a long story but in short we moved onto our business as we are self employed. However i have explained to our agents that we will be moving to oz & apparently they have landlords all over the world ( was trying to contact someone in Dubai when we were in office on 1 occasion) i feel a lot happier with these as if there are any problems they sort it. for example the boiler went a couple of weeks ago, they contacted us asked could there engineer fix it, we agreed, boiler fixed within couple of days & payment taken out of the next months rent. no hassle for us & problem solved quickly for tenant. Our last agent was supposed to get someone to look at the fire but never did resulting in nearly having to have it condemned!!! The only worry i do have is who will clean the house when these tenants eventually leave ( if they do leave!!! ) ready for new ones but i'm sure the agents will be able to sort this out too.

Re: Renting question
 

We are renting ours out - leave for Oz on Sunday. We phoned the mortgage lender to 'enquire' about letting the property. They told us that our mortage would go up by £290 a month!!! Needless to say we never told them we eventually rented it out. Our agents are looking after everything and they have an insurance policy that pays out if our tenents don't. Fingers crossed it goes okay.

Kareena

Re: Renting question
 

We are with the Halifax and I have already enquired about renting out our house, there conditions were you can't rent while on a fixed rate deal. That was it.

So check if this is not restricting your lenders decision.

Re: Renting question
 

Which building society are you with, may I ask?:D

Alistair

Re: Renting question
 

Hi,

We too are with the Halifax and they said no problem about renting on our fixed rate :confused:

All we have to do is apply for a consent to let and the mortgage would then have to go on the standard variable, this can only be done for a maximum of 3years though. We are now at the end of our fixed rate and is due to be renewed at the end of the month before we fly out. We have rellies that will be renting off us till June 09 but the house will also be on the market so I don't know whether that changed the situation or not :confused:

On the mortgage note though, I did alter our mortgage over the phone at work today from a 20 year mortgage to a 35 year mortgage (only for the short term may I add :ohmy: , and this has dropped our payments by £130.00 a month so far, and this will be due to drop again at the end of the month when the fixed term is up. Again this is purely on personal circumstance though, I'm not saying it will work for everybody but it will definitely help us out whilst we try to sell as it will bring the payments down quite a wack, especially having rent and a mortgage to pay from Oz after June !!!

Donna.

Re: Renting question
 

I think their issue is that if you default and they have to reposess the property, they don't want a sitting tenant.

When I told mine, they didn't increase the rate but I had to sign something - sorry, was a long time ago now and I can't remember what exactly. :o

Re: Renting question
 

I was with Nationwide too and they allowed it without any hassle at all but that was over 3 years ago. Be careful if you are considering renting your homes out. My house was a few years old and immaculate when I left it, the elderly tenants who I met seemed lovely but within 6 months they had split up, he pulled the door off the 2 year old dishwasher, pulled the sink off the wall in the bathroom & ripped the electrical box off the wall. I had a very well known UK estate agent managing the property at the cost of 11% & they said he refused to accept responsibility saying it was wear and tear. :confused: To cut a long story short I ended up having paying for all of the repairs minus a couple of hundred pounds of his deposit as it was either that or take him to court which would have been a nightmare trying to arrange from Australia.

Re: Renting question
 

We are with the Coventry Building Society, they have been really good.

Re: Renting question
 

Have seen an agent today who have said we need to have permission from the lender in writing before they will agree to let it for us:(

Re: Renting question
 

What business is it of theirs whether you have a mortgage or not? It never occurred to me to tell our letting agents, neither did they ask me.

One thing I would say about letting agents is don't just look at their charges. Our agent is useless, it takes them weeks to get the rent to us and, worse, they do nothing about any problems that the tenants report until a minor problem becomes a crisis (no doubt the tenants think we are terrible landlords!). For example, we got them to arrange a quote to sort out water ingress about 18 months ago, gave them the go-ahead and then it turned out they'd not bothered to follow it up so we've got water damage. No-one ever returns your calls and even written complaints get ignored. I'd like to sack them but I don't know if I can do that without turfing out the tenants, which hardly seems fair (anyone know if we can do this?).

That said, unless you have a personal recommendation, I don't know how to choose a good agent..... if there is such a thing.

Re: Renting question
 

You must be able to give them notice, they may want a fee for finding the tenant, check your agreement with them. Ask to change your property manager, some are a lot better than others.

Re: Renting question
 

Google is your friend - ASk that question here:
http://www.landlordzone.co.uk

Re: Renting question
 

I have never informed the Nationwide and Ive now been renting my house out for almost 7 years! Rent is paid through housing benefit, its been fine really, and now interest rates have dropped the HB covers the mortgage. Would like to sell though, but not looking good.

Its not always on my mind, sometimes the bills are (were) but the main prob is being so far away to sort things, on the whole Im glad Ive done it, Portsmouth City council have paid 6 years off my mortgage! ( I used to work for them.... so am doubly pleased with that!) :thumbup:

Re: Renting question
 

I've had a second agent round today and on the first page of their info they state that they must have written confirmation from our lender that they agree to us letting it out. How have people who've not got permission, managed to let their property? Have we just been unlucky with our agents so far?

Re: Renting question
 

What mortgage? Surely you've paid it all off by now? ;)

Re: Renting question
 

I wished! Actually, decided to do the right thing and phoned my mortgage company and they said no problem for anything up to 3 years so that's a huge relief, worrying over nothing :cool:

Re: Renting question
 

Hi Louie :)

Sorry to hear the PM's not going well! Just to let you know, however, that you can certainly change PM's without affecting the tenancy. Simply give them the required notice (look at your managaing agreement- it's usually 30 days) and get the new PM to take over the paperwork and inform the tenant. Dead easy. PM me if you need any help!

Re: Renting question
 

When I worked for one building society there was nothing we could do because we can't take anyone else's word for it. We had sent debt collecters to one property, tenants answered the door said they rented it through letting agency etc and we STILL couldn't do anything with regards to calling in loans, advising them they were in breach of agreement etc because the borrower had to be the one to tell us. Very bizarre but our hands were completely tied.

Obviously this was the case for the Building Society I worked for, can't comment on others...

Re: Renting question
 

Hi Jacque

I don't think I explained myself very well. Our tenants in Oz are great, we don't even have an agent, they will organise anything that needs doing themselves (not that anything has needed doing even though the place is so tatty as you know). We have another rented place in the UK and that's the one where the agents are dreadful.

Hope business is OK for you, from what I've read property prices in the lower north shore are dropping like stones :( C'est la vie I guess.....

Re: Renting question
 

Hi Louie

Thanks for clearing that up! My misunderstanding :)
Glad to hear the Sydney place is going well at least. Don't know the UK rules about PM but I'm sure someone on here will!

Business is good and don't believe everything you read about the North Shore prices dropping! The Oz housing market is nothing like the UK or US and though not immune, our conditions are different enough to hopefully see us through these difficult economic times. We're now starting to enjoy the benefits of some positive market conditions such as the recent interest rate drops that have virtually eradicated six years of rate increases in less than 6 short months– something that hasn't happened here for almost 2 decades!

First home buyer grants have increased (now $14K for established and $24K for new dwellings) and the latest RPData statistics show that we're beginning to see the first signs of activity returning to the lower end in our capital cities and regions. Growth has varied from suburb to suburb in Sydney, but it's my opinion that we're now on the path to recovery, despite the tighter lending criteria and global conditions. The properties that have experienced the largest price drops have been the higher end ones that the media loves to report on- but this isn't surprising given that there's only a very limited amount of buyers for such properties. Anything close to median is doing very well, thankyou, especially well located units in the inner and middle ring suburbs. Houses in the sub $500K price bracket are also in demand in most areas, mainly due to the recent grants and affordability improvements.

Supporting this, we have strong population growth (helped by the Rudd govt's increase in immigration numbers) limited housing supply and the lowest vacancy rates for houses and units in 20 years. In comparison with shares, the ASX 200 fell by over 40% during 2008 whereas property values across the nation fell by less than 2 percent. Very telling about what people consider a safer investment :)