Do you think banks employ teams of people to validate their entire Mortgage catalogue and ensure their customers are living in their residential Mortgage properties? If you commit Mortgage Fraud and it results in a loss to the bank, sure they'll take legal action, if you pay your Mortgage every month, nah. I'm not recommending to do it, I'm just stating facts. Banks should do more checks, but they don't.
Renting a House
- Thread starter Goksly
- Start date
Do you think banks employ teams of people to validate their entire Mortgage catalogue and ensure their customers are living in their residential Mortgage properties? If you commit Mortgage Fraud and it results in a loss to the bank, sure they'll take legal action, if you pay your Mortgage every month, nah. I'm not recommending to do it, I'm just stating facts. Banks should do more checks, but they don't.
Soldato
- Joined
- 18 Mar 2010
- Posts
- 4,084
I suggest speaking to a few different letting agents.
The first few years as a landlord we did more ourselves, like I would go in and fix stuff and we had British gas landlord coverage. We found it much easier in the end to let the letting agent sort everything out. British gas was a pain as they won't visit unless someone is present. It was much easier to let the letting agents use their own trusted tradesmen.
The first few years as a landlord we did more ourselves, like I would go in and fix stuff and we had British gas landlord coverage. We found it much easier in the end to let the letting agent sort everything out. British gas was a pain as they won't visit unless someone is present. It was much easier to let the letting agents use their own trusted tradesmen.
Good advice - although requiring a guarantor does remove one of the best type of tenants: foreign IT contractors! No hassle at all, loved every single foreign contractor I've had as tenants.
Not a bad shout I suppose. I've never bothered increasing the rent whilst I've had a tenant in - if they're happy and my mortgage is being paid then I'm happy.
I've been debating making a thread on this for a while - my biggest worry is a huge crash. I don't have a pension or anything, I stopped buying expensive cars and started investing in property and now have quite a large portfolio which I've always seen as my retirement fund. But it does scare me, the thought of suddenly being plunged into the negative. I think I need to protect myself from that somehow, just not got around to figuring it out.
Associate
Have you crunched the number as to what kind of income drop in rent would leave you underpressure? What kind of interest rate rise would cause mortgage concerns?
What rate of return are you looking for and does it realistically beat stock market average for effort you are investing (crucial figure)
No, I've never actually crunched the figures embarrassingly. I aim to ensure mortgage payments are roughly 50-75% of the rental income so I have a safety net there.
I've hit a good rate of return a few years back, it's allowed me to not need to work and be able to stay home with my kids the last 2+ years which is good enough for me. How that compares with stock market average I've no idea.
I suppose I should sit down and actually do some risk analysis with each.
Edit - sorry for derailing the thread, OP
I've hit a good rate of return a few years back, it's allowed me to not need to work and be able to stay home with my kids the last 2+ years which is good enough for me. How that compares with stock market average I've no idea.
I suppose I should sit down and actually do some risk analysis with each.
Edit - sorry for derailing the thread, OP
Associate
Yeah I would say that doing some scenario analysis will provide a level of comfort as to your ability to weather the future. Better to see now any gaps in plan than if things fell off a cliff, especially with an asset class that can lose liquidity quickly...
Usually 25%
Soldato
Could you rent the property out while living there to avoid further problems with your mortgage company?
If you can do that, how often do you need to be there to be considered living at the property, and how would the mortgage company know one way or the other?
If you can do that, how often do you need to be there to be considered living at the property, and how would the mortgage company know one way or the other?
How would that work on the tenancy agreement? And do you think a family would be happy the landlord has to randomly come and stay over at the house!
Why is everyone so hard upon getting around this? just get consent to let, normally just a small admin fee, and then you can change to a BTL at a later date
This is what I found. I started off trying to do it myself, but it was hard trying to fit in repairs etc around a full time job, especially when one of the houses was a 45min drive away.
Going fully managed is the best thing I've done and a good agent is worth their weight in gold. Mine acts as a BS filter and it's in his interests to get good tenants as it's less hassle for him. If there are any issues, he has a bank of contacts he can call on and they are always prompt and reasonably priced, whereas I always struggled to get tradesmen to respond in a reasonable timeframe. He'll also keep me up to date with any new laws and licensing so I'm not breaching anything.
Exactly. It's really not hard to do. One of mine, I switched to a BTL when I moved out and bought a new house, the other they granted consent to lease with no problems, then when the fixed rate was up just remortgaged to a BTL.
Couldn't agree more, and that's why I would always recommend a good agent. Do you really want to hear every small moan from the tenant, do you want to be the person doing the inspections, are you happy to confront them with issues, tell them you are putting the rent up...
There is not really any extra cost in using an agent as you can take it off your Tax.
Yeah thats me. One percent for 12 months isn't too bad, and after that I can just see... but yeah still thinking why they need to know, but yeah "do it properly".
Not going fully managed as the cost is crazy. £1200 is what 2 agencies think I can get (getting a 3rd in a few weeks), with 7% (usually 10% and I was very impressed with the guy who came around for the one in particular), vs a flat rate of £800 in my pocket for fully managed. Bit steep considering its a new build so I'm not expecting anything to go wrong (famous last words). Boiler is served every 12 months.
Thanks a lot for all of the information so far. Going to play it safe for 12 months and see if I want to take on any responsibility going forward, but really hoping for a family just to be happy. Some of the houses on the estate, whilst bigger but still 3 double bedrooms, are going for £2000 so yeah hopefully happy to say in my humble home
If you work full time, it's worth every penny in my opinion. I pay just over £1100 a year on each house (you can claim it as an expense on your tax return though) and after initially self managing, I wouldn't hesitate to pay that now. I had the tenants call at 7pm one Sunday evening when they'd set the kitchen on fire and the fire brigade had to come round and rip the oven out. Sorting all that out when I wasn't near the house and was in work the next day was a nightmare. Now if anything happens, the agent deals with everything.
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100%
£56 a month, fully managed. Saves me dealing with the hassle but my house its rented to my cousins girlfriend so I get no fuss from her anyway
Pretty much, as long as they get thier money and nothing bad happens or tennants not moving out when you want them to etc burning house down, they will never know or care.
I used to rent of a friend like this for bloody years, no problems.
Family is probably best or extremely close friends however if you do go the naughty way.
I use a management company who charge 7% and they deal with everything.
I’ve given them the green light to go ahead (their handyman) with any repairs that need doing up to £300 without contacting me.
My tenants happiness is absolutely my top priority, as changing tenants stresses me out big time.
I have always said that as long as a tenant is in there, I won’t (and don’t) put the rent up as long as they look after the place and cause me zero grief.
My current tenant is paying around £100 less P/M than similar properties, but she’s been in there for 2 years and is no problem.
I do however have a very strict criteria as to whom I’ll rent the place out to.
I won’t say what, as I’m sure I’ll get called some sort of “phobe” or “ist”, but it’s my place and my choice, and "touch wood", so far everyone has been brilliant.
If it sits empty for months because I can’t find the right tenant, then so be it.
When I started renting the property I didn’t tell the mortgage company as I only had a short period left to pay it off, but tbh if it was longer, I still wouldn’t have told them.
I’m sure its been mentioned, but you’ll need to pay tax on the extra income, but self assessment is a doddle and you get £1K relief off for repairs etc.
If I’m honest, sometimes I forget I even own the place as I can go for months on end without hearing from the management company, but, I’ve been exceptionally lucky.
You only have to watch one of those “tenants from hell” type of programs to scare the living jeebus out of you.
Either way, I wish you the best of luck if you decide to go down that route
I’ve given them the green light to go ahead (their handyman) with any repairs that need doing up to £300 without contacting me.
My tenants happiness is absolutely my top priority, as changing tenants stresses me out big time.
I have always said that as long as a tenant is in there, I won’t (and don’t) put the rent up as long as they look after the place and cause me zero grief.
My current tenant is paying around £100 less P/M than similar properties, but she’s been in there for 2 years and is no problem.
I do however have a very strict criteria as to whom I’ll rent the place out to.
I won’t say what, as I’m sure I’ll get called some sort of “phobe” or “ist”, but it’s my place and my choice, and "touch wood", so far everyone has been brilliant.
If it sits empty for months because I can’t find the right tenant, then so be it.
When I started renting the property I didn’t tell the mortgage company as I only had a short period left to pay it off, but tbh if it was longer, I still wouldn’t have told them.
I’m sure its been mentioned, but you’ll need to pay tax on the extra income, but self assessment is a doddle and you get £1K relief off for repairs etc.
If I’m honest, sometimes I forget I even own the place as I can go for months on end without hearing from the management company, but, I’ve been exceptionally lucky.
You only have to watch one of those “tenants from hell” type of programs to scare the living jeebus out of you.
Either way, I wish you the best of luck if you decide to go down that route
Associate
- Joined
- 11 Mar 2005
- Posts
- 1,129
My Consent to let costs me the princely sum of 0.25% on top of my repayment mortgage.
just pay it.. backside is then covered should your tenant burn the place down…
Get proper insurance and it’s plain sailing.
just pay it.. backside is then covered should your tenant burn the place down…
Get proper insurance and it’s plain sailing.
Also agree with fully managed, although things shouldn't go wrong with a new build tenants seem to break stuff, its never their fault and won't be presented as something they have broken but the shower will leak (inability to use shower curtains) or the front door will stop shutting properly (propping open while they smoke outside, it blows shut on the latch) and that kind of thing.