Can they pull the rug out this fast ??

by Readers Question

10:37 AM, 19th December 2016
About 2 years ago

Can they pull the rug out this fast ??

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Can they pull the rug out this fast ??

I have had fully licensed 6 bed HMO for 5 years ( Basinghall finance mortgage ) who granted the change of mortgage 4 years ago, this company has been taken over by Bluestone mortgages in last two years
I have just received a letter stating that I am in breach of contract and if I don’t get the house down to 4 tenants they will come and evict the tenants.rug out from under

Can they do this ?

Also they are denying any knowledge of this house being HMO even though every year the council sends them letter stating this?

Can they pull the rug out this fast ?

Rob



Comments

Neil Patterson

10:42 AM, 19th December 2016
About 2 years ago

Hi Rob,

It depends on what the original contract allowed.

Did the original mortgage contract with Basinghall allow for a 6 bed HMO?
If not did you then get written permission to let the property out on this basis and how long was the permission for?

It would be unusual for a lender to evict tenants. It is more common if you have broken mortgage conditions for the lender to request repayment of the loan or if this is not possible to appoint LPA receivers.

I am not sure it is clear what has happened here so you may need legal assistance.

Ian Narbeth

14:50 PM, 20th December 2016
About 2 years ago

Rob
Stage 1 I would try to gather some information from them first. Ring up and try to speak to someone who has the file and can talk intelligently. Don't be afraid to ask to speak to a manager. I would not at first get angry or say they can't do this or that. Rather find out what information they have and why they have after all this time written to you as they have. If you are lucky it is just a misunderstanding. However, if you are on the wrong product you may have to swap to a new, higher rate product.

Stage 2 If they won't withdraw then try to persuade them that 6 people paying rent is better than 4 and that by reducing the number of tenants you will increase the risk of default. If that fails then negotiate for as long as you can (ask for at least 6 months) to get the numbers down and in the meantime re-finance with another lender. If you can't re-finance then get legal advice and see what the terms of the original loan were. From their website it seems they do not lend on HMOs. Their mortgages "are designed to help customers who can demonstrate affordability, but are struggling to get past automated application processes. They help all types of customers including Self Employed, Contractors and those that have experienced credit problems through a genuine bump in the road." so they may not be right for you. Even if your lawyer can get them to back down I would still re-finance because they may call a default for any breach of conditions.

Rob Munro

15:55 PM, 20th December 2016
About 2 years ago

Reply to the comment left by "Neil Patterson" at "19/12/2016 - 10:42":

Hi Neil,
Thanks for your help.
They did originally accept a change from a standard buy to let to HMO now the new company are refusing it , it's a such vague situation , other than they are denying all knowledge of it .
Of course the letter they sent me 3 years ago has been destroyed ?
Thanks again Neil

Rob Munro

16:01 PM, 20th December 2016
About 2 years ago

Reply to the comment left by "Ian Narbeth" at "20/12/2016 - 14:50":

Hi Ian!
Many thanks for the great ideas , I can't even get past the receptionist . For the stage 1 .
I think I am left with legal advice .
It's my only rental and I take good care about my 6 tenants . This company has us all worried now over Xmas that the new year will bring 2 people homeless and myself unable to refinance to save my business .
All because they are denying the previous company's agreement with me .
Thanks again Ian much appreciated help


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