Help with Consent to Let after whirlwind romance

by Readers Question

11:11 AM, 19th January 2017
About 4 years ago

Help with Consent to Let after whirlwind romance

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Help with Consent to Let after whirlwind romance

USAThanks in advance to anyone who takes the time to offer advice on this!.

I have a rather unusual situation. At the beginning of October I completed on my first property and now have a residential mortgage with the Woolwich.

Fast Forward just over 3 months later and Ive fallen in love and married someone in America.
I am now ‘trapped’ here waiting at least 7 months for the paperwork to come through for my Green Card.

This was never planned, but now I’m going to live in the States and have rented out my flat.
At the time I knew nothing about this. I just rented it to be able to cover my mortgage payments. Which the rent almost does.

Now however, I understand that if I rent it I will technically be in breach of contract with the Woolwich.

So my question to you guys is, whats the best way to handle this? Should I apply for consent to let?
Ive only had the residential mortgage for 3 months so I definitely don’t fulfill that criteria. But without the rent from the property there’s no way I’ll be able to cover the monthly payments.

Or should I remain schtum. This is not a money making exercise, this is pure survival.
How would the mortgage company find out that I was not living there? And how likely is it that they will check?

In short, what’s the best way to deal with this rather unexpected situation?

Thanks everyone

D

Comments

Chris Clare

10:43 AM, 20th January 2017
About 4 years ago

Reply to the comment left by "John Constant" at "20/01/2017 - 09:40":

I completely agree John you have an obligation to be honest with the lender but without an adequate green card for the US he is going nowhere so there is little point in saying anything in that regard until it is fact. Moreover he is only obligated to answer what he is asked.

I have always wanted to jump out of a plane but until I do, I haven't.

Hercules Botha

11:24 AM, 20th January 2017
About 4 years ago

I would mention everything. The fact that you are moving to America is one of the reason lenders would agree the consent to let. It is a valid reason. Same as for people who have found work away from home or go travel. If say you want consent to let and then tell them you are moving to mom and dad's you'll have a much harder time justify it.

Freda Blogs

12:35 PM, 20th January 2017
About 4 years ago

I think you will also find that your insurance is invalid if you do not have the proper paperwork/mortgage product in place.

Luke P

13:37 PM, 20th January 2017
About 4 years ago

What are your plans for the property once state-side...to sell?

The proper advice would be to be upfront and honest, but for the time being I would keep quiet. You've not long bought and as long as you pay the mortgage, you should be sweet. Get proper insurance and try to find a buyer so you can be rid of this mess.

Jim Duggan

19:49 PM, 20th January 2017
About 4 years ago

Reply to the comment left by "John Constant" at "20/01/2017 - 09:07":

Hi John, thanks for your reply. Im not living in it cos Im 'trapped' in the USA.
I decided to marry once I was there. And now I cant leave till the paperwork's done.
Thats why I arranged to rent it while I was here.

Jim Duggan

19:59 PM, 20th January 2017
About 4 years ago

Reply to the comment left by "Hercules Botha" at "20/01/2017 - 11:24":

Hi Hercules, yes that was my thinking too. The only reason I think they might give me consent to let is the fact that Im marooned in the States. Im literally stuck in America until my Green Card goes through. And I had no idea on the whole consent to let thing in the first place. I think if I dont mention this US detail then my chances of getting consent to let are slim to none.

Luke, how do you mean get proper insurance?
I just bought. Its share of freehold. But Im still waiting for my application to go through the land registry. I have building insurance only.

Thanks
d

Graham Bowcock

20:14 PM, 20th January 2017
About 4 years ago

Dear D

There is some conflict in the responses but you need to be very careful as to how you proceed. It is absolutely correct that you must tell your mortgage company; if they find out they will be far less charitable than if you tell them now. A mortgage is a legal agreement and you appear to be already in breach of it. I wonder if your agent failed to explain things to you! It is in my firm's terms of business that the landlord must have lender's consent. If you didn't an agent how have you sorted all the compliance paperwork (something a lender will be looking at)?

A couple of people have said you need to tell your insurance company and this is also very true. If there is a claimable incident you may not be insured. Insurance for let houses is not necessarily very expensive but cover is specific.

Finally, have you got into the Non-Resident Landlord scheme (NRL) so as to avoid tax issues with your tenant (or agent). You need to go on line to sort this is you have not already done so. This is equally as important as sorting the mortgage and insurance.

I think that your argument that this is not a money making exercise is weak and the relevant bodies will not take this into consideration. You need to be as compliant as any professional landlord. If you are in the US you may be better getting somebody in the UK to help you.

Graham

Jim Duggan

20:28 PM, 20th January 2017
About 4 years ago

Reply to the comment left by "Graham Bowcock" at "20/01/2017 - 20:14":

Hi, thanks Graham (and everyone else)

While I appreciate the rights and wrongs and moral implications. I know in my heart that Ive not done this to screw anyone or make money. I simply need to be able to pay my mortgage. Its that simple. In the US I have no job currently so Im living off my savings. And supporting a new wife and 3 year old child in the process.

For these reasons, I think Im willing to leave my morals at the door for now.
So long as I keep paying the mortgage repayments, how likely is it for them to find out?
Be great if you guys could advise me on this, while parking your moral attitudes if possible.
Additionally, if I may be so bold as to ask what I can do to potentially lower the chances of them discovering that Im no longer resident?

Also, what do I need to do with my insurance exactly? Its not contents Im insuring, just the building. And its shared between my fellow freeholder.

Finally, what is the Non-Resident Landlord scheme (NRL) you mention?

Apologies but as you can see, I know nothing about these things. I simply bought a house and then unfortunately fell in love:)

ilc72

21:12 PM, 20th January 2017
About 4 years ago

Reply to the comment left by "Jim Duggan" at "20/01/2017 - 20:28":

Generally Woolwich will grant CTL after six months, usually to the end of the fixed rate or term of mortgage product.

I have had a similar dilemma in the past, so waited for the six-month period and then applied.

At the time it was also an 85% mortgage, but they refused the request to convert to Interest Only.

All of this was without the US issue though!

It was converted to an Interest Only BTL once the remaining 30 months of the fixed rate agreement expired.

Two things concern me about your case...

Firstly if the rent barely covers the mortgage, what will you do if you have a rental void? Have you got savings to cover the costs?

Are you using an Agent? It'll be virtually impossible without one! Again that'll eat into the income.

Also if you're going to be in the US don't forget about the IRS, their equivalent of HMRC, you need to be VERY careful of tax issues!

When I relocated to the US, I was on an ex-pat relocation agreement, my employer sorted it out, as it was a significant cost for dual filing tax returns in two countries. About £1,500 per year in 2001!

If you intend staying in the US everything to me points to selling up! Ask yourself why you're holding onto the property, be honest with yourself? It seems strange that you want to hold on despite the whirlwind romance, perhaps an insurance policy?

PS My last whirlwind romance and marriage ended up with a very expensive divorce. Hope you're more lucky!

Jim Duggan

22:26 PM, 20th January 2017
About 4 years ago

Reply to the comment left by "Ian Clifford" at "20/01/2017 - 21:12":

Thanks Ian!
If they refuse my request I simply wont be able to pay my mortgage.
I will be paying rent in the US and the other costs from my savings. And will not be able to make mortgage payments. So it would not be very charitable, nor smart of them to refuse.

If they refuse, I guess my only option will be to sell up. It's just I wanted to hold onto this property as an investment. I never planned to leave. it was my first house. But now I'm going to live in the US if Im gonna make this marriage work.

Would you tell them and risk this situation. Or keep quiet and hope nothing happens. Im sure there are millions of people who do that without problems.

But if theres something I could do to lessen the chances that would be great.
All I want to do is be able to keep paying my mortgage. And this is the only way I can see of way of achieving it,

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