What is Consent to Let?
Consent to let is written consent from the lender to the property owner, allowing them to rent the property out under the current residential mortgage temporarily. Renting with a residential mortgage is something homeowners may wish to do if they want or need to rent their home out short-term.
Letting on a Residential Mortgage
Ordinarily, you cannot let a property out on a residential mortgage. This is why consent to let is required. When you sign a contract for a residential mortgage, you agree to live in the property, and using it to rent is breaking the agreement. If you wish to buy a property to let, you must ensure you have a buy-to-let mortgage. Letting on a residential mortgage without consent to let from your lender could result in financial penalties.
When is Consent to Let Needed?
There are several reasons why a homeowner may require consent to let. Examples are:
- Short trips overseas (business, extended holiday, family emergencies)
- Temporary work in a different part of the UK
- Caring for relatives
- Renting while waiting to sell
How to get Consent To Let
Speak with your mortgage lender to find out their consent to let conditions. Most high street lenders will be able to assist you with this. It is usually a simple process that can be arranged in-store, online or over the phone. There are fees involved, but they should be reasonable.
Consent to let applications may be refused in some cases. Possible reasons are:
- Your financial situation is poor
- You’ve missed mortgage payments
- Your mortgage is less than six months old
- The equity is poor
- You’re part of a scheme that prohibits consent to let
- Rental income doesn’t cover the mortgage payments
Consent to Let Duration
Consent to let is a short-term solution that lasts six to twelve months. In some cases, they may last up to twenty-four months. Once the consent to let ends, you will return to the original terms of your residential mortgage and the letting must cease.
Pros and Cons of Consent To Let
Pros
- Covers mortgage payments if you have to leave home for a while
- Can fund travels
- Provides time for selling and finding a new home
- Gives homeowners a feel for buy-to-let
Cons
- Fees
- Landlord duties
- Mortgage payments continue in void periods.
Contact Hardings Lettings for advice on renting on 01277 233400.
