GetMeDownUnder Posted June 24, 2014 Share Posted June 24, 2014 We are moving to Oz next year and had a plan. 1) Let out our house which has now just finished its 5 year Fixed Term mortgage. 2) Remortgage our property and use about 20k of equity to pay for Australia relocation (visa fees, flights, animal shipping etc and have some cash for a rainy day which could go back into the mortgage later). We spoke to our existing mortgage company today who advised that they cannot give us any cash back out as they would not be happy with us using it for Australia especially as we may not have a job there, or that we may be unable to let the house out (as if). He did say that they would have given us the cash to consolidate existing debt (e.g. the visa fee which is currently on a 0% card awaiting equity back from the house). In essence, it appears that I can get the 20k if I accumulate debt first, yet they will not give it to me if I ask up front for cash which I have already put in (and despite the house going up in value 50k in 5years). Does anybody have any good advice? Ideally I would go against a small loan, and switching 0% credit cards may be very hard to come by next year as we will no longer be in the UK. Do we take the debt up front first, then remortgage to another company and consolidate the debt with them? Can we remortgage with another company and take cash back out anyway ? (as we have about 60% LTV). Should we get a residential mortgage and then request a short term Buy-To-Let agreement with the lender just before we go, or get a Buy To Let now? I think the simple answer is to get proper advice from a mortgage broker or equivalent? Thanks to anybody with some insight. Link to comment Share on other sites More sharing options...
Guest guest30085 Posted June 24, 2014 Share Posted June 24, 2014 I put mine up for sale, despite all the opinions that I should rent it out, I didn't want the responsibility nor the expenses when the property wasn't being rented. Therefore I'm no help . Definitely speak to an independent mortgage advisor. Congrats on the visa btw Link to comment Share on other sites More sharing options...
GetMeDownUnder Posted June 24, 2014 Author Share Posted June 24, 2014 I put mine up for sale, despite all the opinions that I should rent it out, I didn't want the responsibility nor the expenses when the property wasn't being rented. Therefore I'm no help . Definitely speak to an independent mortgage advisor. Congrats on the visa btw Thanks We are happy with our home and my company will give me 12 months out. It therefore makes sense to try and keep it as we could come back to what we know if things did not work out. Link to comment Share on other sites More sharing options...
Guest Posted June 24, 2014 Share Posted June 24, 2014 If you are planning to rent it out you will need a 'buy to let' mortgage - there should be no problem in getting one as it is based on the rentable value rather than your income, I think I would be tempted to play down migrating and simply say you plan to travel and want to release funds and rent the house out whilst you are away. I would think very carefully though, you cannot rely on renting the house out and have to think of any rent as a bonus. If you can't afford to pay your mortgage, council tax, water rates etc. on top of your Australia expenses do not even think about it. We had tenants who stopped paying rent, it took 7 months before they moved out. Our house was wrecked (beyond imagination), I could not travel back to the UK for a further 4 months and it took a further 3 months for the repair work (about £10k) to be done. It then was 9 months before we got new tenants (& had to reduce the rent significantly). All in all we were paying the mortgage for a year and 10 months with no income and spent £10k. Our honeymoon in Australia came to an abrupt end and without the best friends in the whole world helping me out (now we are back I have met people in the community who pitched in who had never even met me!) I don't know where we would have been. Ours is a horror story and it doesn't turn out this way for most people but getting a none paying tenant out isn't easy (& even the most decent people have change of circumstances & the council will advise them not to pay and not to move out!) and it seems that once the house is empty it becomes harder to rent out again, there was 3 of us in my team of 8 at work with empty houses in the UK that just wouldn't rent out. Since you have equity I'd simply sell - you have PR for Australia so unless you plan to come back to the UK you are better off with a clean start & no debts. Link to comment Share on other sites More sharing options...
Guest Posted June 24, 2014 Share Posted June 24, 2014 Just read your reply to Adonna - I guess if you are not certain you will stay it makes sense. Don't assume that you can simply get your home back off a tenant should you decide to move back after 12 months - only a court can evict, the owner can't! Link to comment Share on other sites More sharing options...
GetMeDownUnder Posted June 24, 2014 Author Share Posted June 24, 2014 Just read your reply to Adonna - I guess if you are not certain you will stay it makes sense. Don't assume that you can simply get your home back off a tenant should you decide to move back after 12 months - only a court can evict, the owner can't! Thanks. Nothing in life is certain and we have jumped through a lot of hoops to get to Oz so we are not taking it lightly. It is also nice to try and keep a house here as an investment. A tenant will have a lease and a release term so we could factor that in and move back to coincide with this Link to comment Share on other sites More sharing options...
GetMeDownUnder Posted June 24, 2014 Author Share Posted June 24, 2014 If you are planning to rent it out you will need a 'buy to let' mortgage - there should be no problem in getting one as it is based on the rentable value rather than your income, I think I would be tempted to play down migrating and simply say you plan to travel and want to release funds and rent the house out whilst you are away. I would think very carefully though, you cannot rely on renting the house out and have to think of any rent as a bonus. If you can't afford to pay your mortgage, council tax, water rates etc. on top of your Australia expenses do not even think about it. We had tenants who stopped paying rent, it took 7 months before they moved out. Our house was wrecked (beyond imagination), I could not travel back to the UK for a further 4 months and it took a further 3 months for the repair work (about £10k) to be done. It then was 9 months before we got new tenants (& had to reduce the rent significantly). All in all we were paying the mortgage for a year and 10 months with no income and spent £10k. Our honeymoon in Australia came to an abrupt end and without the best friends in the whole world helping me out (now we are back I have met people in the community who pitched in who had never even met me!) I don't know where we would have been. Ours is a horror story and it doesn't turn out this way for most people but getting a none paying tenant out isn't easy (& even the most decent people have change of circumstances & the council will advise them not to pay and not to move out!) and it seems that once the house is empty it becomes harder to rent out again, there was 3 of us in my team of 8 at work with empty houses in the UK that just wouldn't rent out. Since you have equity I'd simply sell - you have PR for Australia so unless you plan to come back to the UK you are better off with a clean start & no debts. Thank you for the advice. Our home is in a street where the last house had 8 people wanting to view within 1 hour of it going up on rightmove (told by the owner). I am very sure that we can rent out easily but you are correct that anything could happen with the wrong tenants. The other half is keen to keep her home but the risk is certainly there - thankfully I know that we can obtain help from parents etc if a similar unlikely issue happened to us. Link to comment Share on other sites More sharing options...
Peach Posted June 24, 2014 Share Posted June 24, 2014 A tenant will have a lease and a release term so we could factor that in and move back to coincide with this You are missing Lady R's point. If your tenant's circumstances change - or they decide to stay on - their rights are better protected than yours as a landlord. The council will advise them to squat until a court evicts them, which takes months. My UK property is in the hands of a management company, yet they still basically said "you're on your own" in our contract if the tenant stops paying.... Link to comment Share on other sites More sharing options...
Guest Posted June 24, 2014 Share Posted June 24, 2014 Thanks. Nothing in life is certain and we have jumped through a lot of hoops to get to Oz so we are not taking it lightly. It is also nice to try and keep a house here as an investment. A tenant will have a lease and a release term so we could factor that in and move back to coincide with this I'm afraid it's not that simple - please look into it. The end of a fixed term lease gives you the right to apply to the court for eviction but that's it. https://www.gov.uk/private-renting-evictions Most tenants of course don't know this and will obediently move out but if they have trouble finding new accommodation and turn to CAB/Shelter/Housing Associations/Local Council etc. for help they will be told not to move out. In fact moving out would be considered making themselves 'voluntarily homeless' and not entitled to help. Make sure you take out legal protection - we didn't, we thought a letting agency doing credit references and managing it for us would be protection enough - far from it [h=3][/h] Link to comment Share on other sites More sharing options...
ramot Posted June 24, 2014 Share Posted June 24, 2014 Lady R gives sound advice above, and obviously had a very bad experience, but we have been renting out several properties in UK from overseas for nearly 20 years without a single problem. So although there are genuine horror stories it can be successful. We were expats for many years and it was quite normal for lots of us to rent our UK home while overseas, and I have to be honest with very rare exceptions hardly any one we knew had a problem. We have always had full management. Good luck with whatever you decide. Link to comment Share on other sites More sharing options...
gumster Posted June 24, 2014 Share Posted June 24, 2014 Weve an insurance through our agent that deals specifically with eviction & the relevant court proceedings & also covers lost rental during this process so all is not lost in the event of feral tenants Link to comment Share on other sites More sharing options...
bovered Posted July 1, 2014 Share Posted July 1, 2014 Has anyone please got some advice for me ?! I have a property in the UK which is currently let through an agent, my 'permission to let' will come to an end in the next few months, and I want to change to a buy-to-let, but my current lender won't allow this as I do not have a second (residential) property in the UK. Is there a broker here in Sydney anyone can recommend, or indeed a lender in the UK that might be useful. I'm feeling desperate as I don't want to sell, and I don't want to return yet. Many thanks Link to comment Share on other sites More sharing options...
Guest Posted July 1, 2014 Share Posted July 1, 2014 Has anyone please got some advice for me ?! I have a property in the UK which is currently let through an agent, my 'permission to let' will come to an end in the next few months, and I want to change to a buy-to-let, but my current lender won't allow this as I do not have a second (residential) property in the UK. Is there a broker here in Sydney anyone can recommend, or indeed a lender in the UK that might be useful. I'm feeling desperate as I don't want to sell, and I don't want to return yet. Many thanks What LTV will you have? If it is less than 75% then you should be able to get an ex-pat 'buy to let' mortgage. I 'think' you will need a broker in the UK rather than Australia - certainly a quick google has only brought up UK brokers offering ex-pat buy to let mortgages for UK properties. Here is a couple to get you started - not recommended I only googled http://www.liquidexpatmortgages.com/UK-BUY-TO-LET-MORTGAGES-page-10.html http://www.seemoney.co.uk/pages/offshore/expat-mortgages-buy-to-let.asp Also try HSBC or NatWest both do ex-pat mortgages If you need a mortgage more than 75% LTV then you may be stuck - has your lender categorically said they will not renew the permission to let? Link to comment Share on other sites More sharing options...
GetMeDownUnder Posted July 1, 2014 Author Share Posted July 1, 2014 What LTV will you have? If it is less than 75% then you should be able to get an ex-pat 'buy to let' mortgage. I 'think' you will need a broker in the UK rather than Australia - certainly a quick google has only brought up UK brokers offering ex-pat buy to let mortgages for UK properties. Here is a couple to get you started - not recommended I only googled http://www.liquidexpatmortgages.com/UK-BUY-TO-LET-MORTGAGES-page-10.html http://www.seemoney.co.uk/pages/offshore/expat-mortgages-buy-to-let.asp Also try HSBC or NatWest both do ex-pat mortgages If you need a mortgage more than 75% LTV then you may be stuck - has your lender categorically said they will not renew the permission to let? bovered..I think you are in the same boat as me then.. I believe that both HSBC and Natwest will require you to have other residential property in the UK (therefore you cannot get the mortgage if you wish to just let out your own home). Also, I contacted liquidexpatmortgages via their form last week and I had no response whatsoever. Link to comment Share on other sites More sharing options...
bovered Posted July 2, 2014 Share Posted July 2, 2014 Thank you ALL so much for the advice - I really had NO idea where to start. I will look in to the UK brokers. I think I'll try to ring initially, I'll let you know how I get on. No, my lender will definitely not extend my permission to let under a residential mortgage. My LTV is less than 75% so I hope I'll be able to arrange something. Get Me Down Under - your problem is complicated by your need to release equity, otherwise you could arrange another fixed rate for say 5 years and then ask permission to let - I believe most will grant this (don't say you're emigrating, just say being seconded for job position) for the term of the mortgage arrangement, this will give you time to decide what to ultimately do with your property. I will also look into BtL via a broker, I'll let you know how I get on, if you have any luck please PM me. Many thanks all. Link to comment Share on other sites More sharing options...
fifi69 Posted July 2, 2014 Share Posted July 2, 2014 We've been letting our UK house out for the past two years.... tbh it's been a pain in the arse...even using a full management service. We have the tenants from hell though, we've tried to get them out but they have the law on there side. Thanfully though they have still been paying the rent. I think you need to think of renting your house out as a bit like putting your money into shares. Your money can go up or down. If you can get good tenants in, then a few years down the line you can hopefully make some money. Or you end up having to pay for two mortgages and loads of repairs. we had to take this route because we came here on a 457 visa. Now though we are settled in Oz, we will try and sell. For us the hassle over the financial gain just isn't worth it. Link to comment Share on other sites More sharing options...
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