I have a rental property with a mortgage that has reverted back to the standard variable rate. I want to remortgage the property to obtain a better rate. The value is £110k, my equity is £30k; i.e.: 72% LTV. Legally, do I have to get a buy-to-let mortgage? A friend of mine has three rental properties that are mortaged, but neither is a buy-to-let mortgage; each of his mortgage providers charge a nominal fee either annually or during tenant exchange. Any clarity on this grey area would be much appriciated.

Hi

Your will be in breach of your mortgage conditions if you have not advised them of the letting.

Below is thread for question/answers about advising mortgage co. of lettng.

http://www.moneysupermarket.com/community/forums/t/do-you-have-to-let-your-lender-know-if-youre-rent-24805.aspx

I think if you advised the mortgage company they will apply relevant additional terms to your mortgage, including a revised rate.

Huckster

Huckster,

Thanks for the link, I must've missed that one.

My current mortgage provider (Northern Rock - funnily enough!) is aware that I let the property and had given consent to let two years ago. They said it fine, unequivocally, and I paid the £250 one-off fee.

There was a comment in the link that said it is not illegal to let a property on a residential mortgage; with this in mind (my friend is not going to get imprisoned!), I am going to approach new lenders asking for a residential mortgage with consent to let and see what rates and fees apply; and if they are comparable to current buy-to-let mortgages available.

Rob