Help with Consent to Let after whirlwind romance

Help with Consent to Let after whirlwind romance

11:11 AM, 19th January 2017, About 4 years ago 42

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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

by ilc72

22:56 PM, 20th January 2017, About 4 years ago

Hi Jim

In your situation I would say nothing, deal with the consequences if/when they occur!

As long as mortgage is paid, I think you'll be fine!

I would apply for the CTL soon after the six-month exclusion.

As another post states, you need to manage the mail situation carefully. Possibly redirect mail to a family member, but also ensure the tenant knows where to send things also, as mail redirecting is a bit hit and miss IMHO.

Could you stay on the Electoral Roll at your parents house for example? You don't have to be registered for Council Tax to do this.

Potentially maintain a utility bill in your own name, e.g. Water? This will always help if you need to do anything financial, even if done remotely.

Do you bank with Barclays? If so, consider moving to another bank so they don't have access to your current account information. That may mitigate risk slightly, though not easy when your stuck in the US.

I'm assuming when you get your papers from the INS, you'll need to leave and re-enter the country anyway. That maybe the time to do it. Money Laundering regulations make it much harder to open an account these days!

Think about keeping a UK PAYG mobile, since you'll need it to be able to fully utilise Internet Banking as often authentication is increasingly done using codes sent via text message.

Also if you are tech savvy get a Voice Over IP telephone number in the U.K. that can be accessed using a laptop or tablet.

Hopefully with some house price inflation your LTV will reduce sufficiently to make it more sustainable.

Conversion to Interest Only would certainly help in the long run!

Finally this is NOT advice or recommendations, merely offering an alternative view!

Good luck with the new life! Quite ironic this comes up on Inauguration Day!

by Thom Hill

12:06 PM, 21st January 2017, About 4 years ago

This thread is quite incredible.

You have admitted (using your real name, seemingly) to breaching your mortgage contract and you are quoting from the non-paying tenant's playbook to try and justify your breach. You've asked whether you should face up to the facts or simply double down.. There is only one possible answer any responsible person can give to that question - certainly in a public forum - because the alternative is dishonest and, more importantly, unlawful.

Having decided to continue in breach of the agreement, you are now asking for tips and tricks as to how you might obscure your breach from the lender so you can get away with it for as long as possible. This is bordering on fraud. You are digging a hole for yourself and anyone responding.

by Hercules Botha

12:21 PM, 21st January 2017, About 4 years ago

Reply to the comment left by "Thom Hill" at "21/01/2017 - 12:06":

Couldn't agree more Thom. It is fraud. Very simple. The reason to get consent to ket is perfectly normal. People need to be honest. Lenders can see far more than you think. Halifax's fraud team out number their new business team 2 to 1. And yes. I heard this from Halifax themselves. Please people, don't con yourself into thinking you are justified. You only have to get cought once and that is it.

by Hercules Botha

12:22 PM, 21st January 2017, About 4 years ago

Reply to the comment left by "Thom Hill" at "21/01/2017 - 12:06":

Couldn't agree more Thom. It is fraud. Very simple. The reason to get consent to ket is perfectly normal. People need to be honest. Lenders can see far more than you think. Halifax's fraud team out number their new business team 2 to 1. And yes. I heard this from Halifax themselves. Please people, don't con yourself into thinking you are justified. You only have to get cought once and that is it.

by ilc72

12:57 PM, 21st January 2017, About 4 years ago

Sorry Thom and Hercules, but your replies are both rather sanctimonious!

It's a personal choice for the OP of what he does, he's been appraised of the risks already many times before your comment.

As for the Fraud comments, ask yourself whether there a large high street bank that hasn't committed control fraud? PPI, Interest Rate Swap being misold to SME's, LIBOR manipulation, fake securitisations of Mortgage Backed Securities, the list is endless! Ask yourself how much Barclays have paid out in fines already, let alone the outstanding litigation that remains.

Life is imperfect and the OP seems genuine IMHO.

I've always paid my taxes, I made a choice to delay my CTL a few years ago and wouldn't do it again now I know the facts and responsibilities.

by Graham Bowcock

13:09 PM, 21st January 2017, About 4 years ago

Dear D

I would have to agree with Thom; it is situations like this that give the sector a bad name and lead to increasing regulation. I fear that your issue with the mortgage is only the tip of your iceberg. I'm assuming you haven't got an agent so it does beg the question as to how you have dealt with the tenancy agreement, EPC, safety checks, deposit protection, etc., etc.

You asked me specifically about the Non-Resident Landlord scheme (NRL) - this is a tax scheme for overseas landlords. You will need to register otherwise there is a LEGAL OBLIGATION on your tenant (or agent) to deduct tax before paying the rent over to you. If they fail to do so then they may be liable - no doubt they would be a bit aggrieved. You can overcome this by registering for the scheme - go to the HMRC website and search for the scheme.

I hope you're not back on this forum in six months' time complaining that you can't get rid of your tenant because the law is against you and you weren't aware of the tenancy start compliance!

My advice remains as before - employ the services of a good local agent without delay to give you proper advice on all issues relevant to your situation.

Graham

by Thom Hill

13:36 PM, 21st January 2017, About 4 years ago

Reply to the comment left by "Ian Clifford" at "21/01/2017 - 12:57":

I have no particular intention to be sanctimonious. My day job involves advising tenants and I tell them the same thing - you can't decide to adopt a dog when the tenancy says no pets just because you didn't think its a big deal and it won't cost your landlord any rent.

by Hercules Botha

14:31 PM, 21st January 2017, About 4 years ago

HI Jim,

Consent to let is free sometimes. (Depending on the lender) And can last for 1-3 years at a time. You need to forget the tips and tricks you have been told on here as this logic does not stand up to a lenders policy. The lenders policy is your yard stick.

I find it frustrating when people try to bend the rules, because most lenders will listen to you. They all have signed up to TCF( Treating customers fairly) They have to take you circumstances into account. I have checked with Woolwich. You just need to call them. They will ask a series of questions. After that they will decide. Usually it is questions to make sure your are being genuine. As you are state side, you'll have a good chance I think, as it is all genuine. As you are applying for a green card, I would assume you have a lot of documents proving your marriage, residency etc. It is unlikely they will ask for these documents, but keep them handy.

https://www.cml.org.uk/lenders-handbook/englandandwales/barclays-bank-as-the-woolwich/?pdf=true#C8913

This is the Council of Mortgage lenders handbook. Specifically, Woolwich's part. You should read 6.6. and PLEASE talk to them and get the facts! Not opinions.

It is ironic that Ian mentioned how the banks were caught and how they were fined for fraud, but seem to think it makes this okay for someone else to do. What do you think will happen if you get caught? They are not going to hold back. They like every corporate will "follow procedure".

Be upfront. if they say no, you will have more leniency directed to you to get the house sold if need be. If they catch you out, they won't care what you have to say.

by Jim Duggan

19:47 PM, 21st January 2017, About 4 years ago

Thanks, I really appreciate the advice from you all, cos it's not easy. I am not looking to defraud anyone, or make money. I am simply trying to find a way to pay for my new 3 year old and wife and my rent in the US, while not having a job. I can not get a job until I have a green card. And I can not leave the United States until the paperwork goes through either. That means I actually can not be a resident in my own house, whether I want to or not.

I knew nothing of consent to let when I originally left for the States and I didnt know I would be forced to stay in the States until my Green Card comes through. Renting my flat out therefore seemed the only solution to my problem. The only way I could make my mortgage repayments. Which I assume my lender wants me to do.

I appreciate that some live in a very black and white world but I think there's a lot of grey.
If I was living in the UK, I would be paying my mortgage payments. Now I am trying to do the same. Surely fraud is about benefiting from your actions. How am I benefitting? The rent I am going to get wont even cover my repayments. And how am I even cheating the mortgage company when Im doing exactly the same as if I were resident.

If I was able to get consent to let for 2 or 3 years then that would be the best solution for sure. I dont really want to sell right now as Ive literally just bought. But if I have to I guess I must.

There are so many parts to this that Im feeling a little overwhelmed tbh.
Never mind the whole tax situation when I do hopefully get a job over here.

But when it comes to laws I believe in the spirit not the letter.
Its easy to just blanket everyone the same. Those are the same people that say 'Oh I can't do that, then I'd have to let everyone do it'. This is lazy thinking. We are all humans surely.

So apologies to the people that just see this as black and white fraud.
Yes it is. But I think it's a little more grey than you think. And my situation is a little different to most. I also wonder if the people saying that have themselves ever broken the law. Like speeding for example, downloading torrents, TV licenses. Many of us break the law. Doesnt mean we're all assholes.

Just for the record, my tenants have not moved in yet. And I am using an agent. They have told me about the whole deposit protection scheme etc. They knew I was planning to move to the States but didnt ask me about consent to let etc. I didnt even know about it either, I just somehow stumbled upon it. I think a lot of people are unaware too. Its not as though we read all the small print.

So do you guys think I should wait until the accepted 6 months are up to ask for consent to let? Which is about 3 more months. Or should I do it immediately?

And Ian Clifford - I bank with HSBC not Barclays. Were I to decide to do nothing as yet, what do I need to do with the mail. If it's redirected, will that not alert the lender that Im not living there? Likewise if I change my electoral role to my parents home? I was considering keeping my phone and internet bill in my name btw. Would this be ok as an alternative to water etc. I just figured it was safer as its a fixed cost, so my tenants couldnt run up a huge bill etc.

Finally what would I need to do with my insurance? Like I said, currently I only have building insurance, paid with my fellow freeholder.

Cheers

by Jim Duggan

19:53 PM, 21st January 2017, About 4 years ago

Reply to the comment left by "Graham Bowcock" at "21/01/2017 - 13:09":

Just looked up NRL scheme Graham. What on Earth?
So if I dont join this scheme and assuming I didnt have an agent (which I do), the tenant just straight deducts the tax from the rent they pay? That seems bananas. I can see why the Governement wants my tax money but surely the tenant doesnt get it. Clearly Im not understanding this properly:)


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