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

Text Size

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 Thom Hill

20:18 PM, 21st January 2017, About 4 years ago

Reply to the comment left by "Jim Duggan" at "21/01/2017 - 19:47":

I think you misunderstand me as offering a moral judgment. It's more that you are seeking advice on how to commit what may well be a criminal offence (probably under section 3 of the Fraud Act 2006).

It probably isn't in your interests, those of other users here or those of Property 118 generally for you to continue to do so. I don't know if you caught my meaning, in particular, about seeking this sort of advice publicly and under your real name.

Maybe you believe in the "spirit" not the letter of the law, but the courts don't.

by Jay James

21:37 PM, 21st January 2017, About 4 years ago

I thought the purpose of this site was to discuss landlord issues. Look at what it has become. If you want to focus on tenant advice, there are other sites for that.

by Badger

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

Reply to the comment left by "Jim Duggan" at "21/01/2017 - 19:53":

I think you misunderstand.

The tenant is required to withhold the tax due on rent to a NRL and then hand it over to HMRC (on pain of death - just like the rest of us).

Are you aware that various outfits (such as bank fraud teams) and not above sticking something like "Jim Duggan" into Google and seeing what it comes up with?

I have sympathy with your personal situation (though I do suffer from sightly raised eyebrows but then that maybe because I had a lot of the romance beaten out of my ancient old skeleton some time ago now).

Nevertheless, I would consider seeing if Property118 would let you change your user name to something a little less easily discoverable and even consider deleting your posts if you can.

It would be mighty awkward if your lender got a whiff of anything on this thread.

by ilc72

22:08 PM, 21st January 2017, About 4 years ago

Reply to the comment left by "Hercules Botha" at "21/01/2017 - 14:31":

Hercules

The banks were never prosecuted for fraud, they all signed Deferred Procesecution Agreements in which no liability is admitted, but promised to behave better in the future and pay fines and restitution in the case of PPI.

Only a handful of people were ever prosecuted, even then only in relation to LIBOR manipulation.

What about HBOS and their team responsible for wrecking hundreds of SME's and the livelihoods of their owners and employees by forcing them into their "Special Situations" team in order to seize assets?

It's called control fraud, read up on the work of William (Bill) Black and Yves Smith of Naked Capitalism, there is so much more I could say but the point is made.

I'm not advocating fraud, as you seem to imply, and I am a responsible landlord and tax payer.

I'd love to see some statistics on prosecutions for breach of mortgage terms, unless the lender carries a financial loss, it is purely a breach of contract and handled as such!

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/10418580/Lenders-crack-down-on-accidental-landlords.html

If you could kindly point me to some case law or actual criminal fraud prosecutions for this I'd love to know?

I'm simply offering an alternative viewpoint, when so many have misconceptions of what is actually taking place.

I went to great lengths in my post to explain the challenges of the tax system in the OP's situation, having had personal experience from having lived in the US.

At no time did I dare even suggest the OP enter into any avoidance schemes!

We live in an imperfect world and there are lots of difficult situations faced by people across the world.

But I was genuinely surprised at the lack of a balanced discussion, breach of mortgage terms wouldn't make the OP the equivalent of President Assad et al!

by ilc72

22:55 PM, 21st January 2017, About 4 years ago

Reply to the comment left by "Jim Duggan" at "21/01/2017 - 19:47":

Hi Jim

Anything to do with mail is only an issue until the CTL is granted. Even if you choose not to apply now, then you absolutely should after six months.

Once that had been granted use a correspondence address, though that may well have to be in the UK.

The mail issue came up for me as one of my properties was used for ID fraud, along with quite a few others in the development.

It has taken a huge amount of time and effort to sort out, luckily I wasn't out of pocket as all the monies taken in my name were wiped off through working with the Credit Reference Agencies, CIFAS, and the lenders concerned.

I have all mail sent to an address that is secure, so anything and everything is sent to that correspondence address. Even my residental mortgage, as I now live in another part of the development since my divorce!

It is good practice for everything to be paperless that can be, including utility bills, bank statements.

Anyone who lets Property should register for the Land Registry Property Alert service.

https://propertyalert.landregistry.gov.uk

Is your property freehold, you mention you have a fellow freeholder?

If you own the freehold, then its less hassle. If it were a leasehold you have an obligation to tell the freeholder, or their appointed agent, that the property is being Let which itself generates sometimes hefty charges £150+VAT is not uncommon.

I wouldn't suggest keeping Broadband and/or Telephone since these agreements need to be regularly monitored and short of blocking all outgoing calls it's a nightmare.

The reason I suggested Water is it is a utility that doesn't have to be maintained as such, especially if there is no Water Meter is fitted!

I'm really glad you've chosen to use an Agent, as others have said, it's an imperative in your situation.

As regards Insurance you'll need to take out specialist Buy-to-Let insurance cover. Even if it's Contents Only, as Building Insurance doesn't covet everything.

However if you have not resided at the property for a while, say 60-90 days, then unless you've informed your insurer then in the event of a claim they may well not pay out. Please check your insurance cover carefully.

Due to your financial situation you may wish to take out Rent Insurance, assuming the potential tenant passes the necessary tests and conditions.

I'd always suggest taking out Landlords Cover from British Gas or Homeserve, ensuring any gas appliances are covered as a minimum with Annual Services and Gas Safety Certificates for each gas appliance, including a gas hob and/or gas fire, fitted.

They can cover plumbing, drains, electrics as well, albeit at a price.

On balance, knowing the challenges you face I'd almost certainly sell up in your situation.

If you're going to stay in the US then I can't see how it'll make financial sense, especially when you transfer to a BTL mortgage.

Remember that stricter rules came into force on BTL lending, and some lenders have even stricter criteria than the minimum.

If you were to apply for any BTL loan at more than 70% LTV then finding a lender that will take on a first-time non-resident landlord is going to be challenging to say the least.

There is a real risk that this property will become a millstone round your neck.

Not sure where the property is located, but there are major economic headwinds blowing our way and if it's outside the South East should a recession hit then it's quite likely you could end up in negative equity!

Some parts of the country saw house prices drop well over 50%, in many of these areas prices still haven't recovered to pre-2008 levels.

by Jim Duggan

16:16 PM, 22nd January 2017, About 4 years ago

Reply to the comment left by "Thom Hill" at "21/01/2017 - 20:18":

Hi Thom,

Im not using my real name if it makes you feel any better.
And I havent committed any offence yet since Im not renting my property out right now either.

by Jim Duggan

19:19 PM, 22nd January 2017, About 4 years ago

Reply to the comment left by "Hercules Botha" at "21/01/2017 - 14:31":

Thanks for sending me the lenders handbook, Hercules!
I read the 6.6 bit but Im not sure what it means, except that yes I have to tell the lender. Which I already know now thanks to you guys.

You said you spoke to Woolwich. What did they say exactly?
My broker originally said they require 9 months before consent to let. But you guys both mentioned 6. Hope so, as it seems more likely they will grant it me if thats the case.

I want to go the legal route for sure. I just dont want to sell so soon after I bought. The whole point was it being my first investment etc. But seems like I dont have much choice.

by Michael Barnes

19:28 PM, 22nd January 2017, About 4 years ago

Reply to the comment left by "Jim Duggan" at "22/01/2017 - 16:16":

from your comment:
"And I havent committed any offence yet since Im not renting my property out right now either."

From original post:
"I’m going to live in the States and have rented out my flat".

So which is it?
And is anything you have posted true?

by Michael Barnes

19:34 PM, 22nd January 2017, About 4 years ago

Reply to the comment left by "Jay James" at "21/01/2017 - 21:37":

Your comment makes no sense, and has also been posted in other threads.

And my understanding was that it was always about property, and not landlords.

However, tenants issues are also (good) landlord issues, and tenant points of view help us to improve our approach.

by Jim Duggan

19:45 PM, 22nd January 2017, About 4 years ago

Oh and forgot to mention. Did they say anything about higher interest rates or penalties if they do agree to consent to let?

At the end of the day, this is no longer a moral issue for me. This is about pure maths.
And what is possible or not possible.

Also back to the insurance question... Are we talking about building insurance or contents insurance that I would need to inform / change to landlords insurance etc. ?

Right now I am a shared freeholder with one other party and I only have building insurance. I have no contents insurance cos Id only just moved in. Now Ive taken everything out with the exception of couch, 2 beds and a kitchen table. Plus plates and cooking implements.

So I wasnt planning to get contents insurance at all.
I was gonna do a professional inventory so if the tenant broke anything Id be able to reclaim it back via their original deposit.

So Id love it if someone could advise me of what extra / different insurance they think Id need based on my above situation.

Thanks


Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?

BECOME A MEMBER