Keeping tracker while renting property

fricatus

Sorry all in advance because I know that there have been threads on this in the past (and I've read them), but this seems to be an area that's changing rapidly, so I think it's no harm to see if anyone has any up-to-date information!

Basically we've a small house in negative equity on a tracker with Ulster Bank. We need more space so we're buying a bigger place (for a song in comparison to what we paid for the other place). We could cover both mortgages out of our income as it is, but we'd have no scope for saving, so obviously we are going to rent out the smaller place.

I presume we will have to let Revenue know about the move for TRS purposes, but I'd also prefer not to have mortgage letters, etc. going to a house with a tenant in it, and that would mean informing Ulster Bank.

Anyone got any suggestions?

Condatis

An Post, for an annual or quarterly fee will redirect you mail to a nominated address.

You can get a form on line or from a Post Office. I've used the service many times.

Paulw

fricatus wrote: »

I presume we will have to let Revenue know about the move for TRS purposes, but I'd also prefer not to have mortgage letters, etc. going to a house with a tenant in it, and that would mean informing Ulster Bank.

Anyone got any suggestions?

You have a legal obligation to let the bank know. Should you fail to inform the bank, and they find out, you could be liable for additional fees.

It's always safer to be honest.

bobbyg

Paulw wrote: »

You have a legal obligation to let the bank know. Should you fail to inform the bank, and they find out, you could be liable for additional fees.

It's always safer to be honest.

Seriously? how many legal obligations have the banks broken in the last few years?

Don't say a word to the bank, inform the revenue and hold on to your tracker for as long as you possibly can. Don't think there is anyway around the letters going to the tenants apart from doing all your banking online.

Liam D Ferguson

Paulw wrote: »

You have a legal obligation to let the bank know.

That legal obligation only exists if the requirement to inform your lender was written into the loan offer documents. Not all loan offers contained the specific requirement to tell the lender if you rent the house out. The only way to know for certain is to ask your solicitor to check the original loan offer and associated documents.

fricatus - don't forget to notify your house insurance provider and register with the PRTB.

3DataModem

Ulster Bank didn't care when I moved and rented. 3 years later, no problems.

fricatus

3DataModem wrote: »

Ulster Bank didn't care when I moved and rented. 3 years later, no problems.

Did you inform them of your change of address? If so, did they ask you any questions about it?

cookie1977

You'd need to inform your insurance company as the house will be rented. That could mean the insurance company will notify the bank about the change as the bank has an interest in your house being insured. You're very foolish not to be up front about this.
The bank will also notice TRS has stopped. Have a read through your mortgage documentation about the potential loss of the tracker. You may not loose it.

fricatus

cookie1977 wrote: »

You're very foolish not to be up front about this.

I have no plan to avoid any responsibilities I will have as a landlord (insurance, PRTB etc.), nor do I plan to avoid tax or lie to the Revenue about what I'm doing.

However I can't continue to live in the house I'm in (it's no longer suitable for our circumstances) and I can't sell it (it's in massive negative equity), so there is only one way out of this right now, which is to rent it out. In other countries I'd be able to hand back the keys (and yeah, lose my deposit, but trust me, the bank would be taking a bigger hit).

What I'm trying to avoid is paying an even higher interest rate for an overvalued property in this situation. The bank will still get its money back.

My fear is that if we even hint to the bank that we might be renting the place out, that we'd be straight onto a higher interest rate. Things are tight enough as it is and we cannot afford an increased burden.

cookie1977

Did you have a read through your mortgage docs to see if it mentions loosing the tracker if you aren't an owner occupier?

The problem for you is that by being up front as you want to be (which I dont think you can avoid) the bank will figure out that the property is rented (via the change in TRS or the change in insurance policy). So it all comes back to what the mortgage docs state. If you they state you could loose it then you may have to face up to that. But if they dont then you're in the clear. The other possibility is that after being up front the bank dont actually notice you're renting and therefore dont know to change anything.

3DataModem

fricatus wrote: »

3DataModem wrote: »

Ulster Bank didn't care when I moved and rented. 3 years later, no problems.

Did you inform them of your change of address? If so, did they ask you any questions about it?

Yes. I moved abroad, and that's where they send my statements. Changed insurance, cancelled TRS, etc. No problemo.

Rabidlamb

OP, if were it me I'd do everything in my power to maintain the Tracker, putting yourself at the mercy of variable rates into an uncertain future is worrying, just ask the customers of the PTSB.
As the charter of this forum prevents me from offering advice which would be deemed illegal I can be of no further assistance.
Delighted to hear you found a suitable home at an affordable price.

easygoing1

Hi All

It says in my tracker mortgage t&c that i cannot rent this property without the written consent of the bank. I am in negative equity. I am with ulster bank and i am getting married soon. My fiance is mortgage approved and we are currently bidding on a house that we love. I need to rent my house. Should i contact the bank and see what they say or say nothing?

ted1

easygoing1 wrote: »

Hi All

It says in my tracker mortgage t&c that i cannot rent this property without the written consent of the bank. I am in negative equity. I am with ulster bank and i am getting married soon. My fiance is mortgage approved and we are currently bidding on a house that we love. I need to rent my house. Should i contact the bank and see what they say or say nothing?

I know plenty if people in a similar position and saying nothing is the general consensus

easygoing1

thanks ted1