Posted on 7 June 2010 by Louise

I have a residential mortgage on a property valued at £245k, outstanding is approx £ 208k. Since I moved in with my boyfriend they lender agreed to buy to let conditions. Due to renew it now, it appears the conditions have been changed and I need to get a rental income of 125% of the mortgage payment. Unfortunately this is not the case I currently receive approx 95% of the mortgage in rent. Can you tell me how is this likely to proceed?


This is a very tricky question to answer. If you tell your Lender that you only receive 95% of the monthly payment then they are likely to refuse to extend their consent and this will leave with 3 options. Move back in, sell the property or remortgage. It is also possible that they will want to re-assess your income to make sure that you can make up the shortfall in rent and allow you to continue letting. This may or may not be accompanied by an increase in the interest rate you pay.

It is always worth asking your Lender what they will do if you continue letting the property without their consent and continue meeting the mortgage payments. Whilst you would be in breach of your mortgage conditions there would be very little for them to gain by trying to repossess the property.

I recommend that you speak to your Lender and if you can't agree a way forward, speak to an independent mortgage broker about the possibility of remortgaging on to a Buy to Let mortgage using your earned income in addition to the monthly rental.


Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.

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