Unauthorised Mortgage - Halifax 'Consent to Lease' grey area

Last post Sun, Sep 16 2012, 12:30 PM by Zeb. 6 replies.
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  •  Sun, Sep 16 2012, 12:30 PM

    Re: Unauthorised Mortgage - Halifax 'Consent to Lease' grey area

    adamh1975: SELL... I would have to say, if only I could sell, i cant because of Ridiculous undervaluing. for instance ..you lent me £130,000 , now your saying that's only worth £105,000 i forgive you for not remembering the house itself has not changed physically, in fact for the better as its been rebuilt , redecorated, loved. yet you take your pieces of paper and mark DOWN the value. How is one supposed to sell?

    You are not selling the house to Halifax, you would be seling to an independant buyer, they would get their own survey and valuation done. I actually wont disagree that Halifax undervalue, I recently had a client who Halifax valued at £80,000 but another lender was haoppy to issue £130,000 against the property. Halifax (in my opinion) do undervalue but its not to con you in any way, it is to protect their own business model and reduce the liability of risk on their side of things. yes the exising borrower does suffer if looking for a remortgage but if they dont like it then they move to another lender.Halifax are also probably one of the more expensive lenders at present, most other lenders will offer better choice and rates.

    The point is, you are not selling at Halifax's offer value, you sell at your own. The price you actually achieve will be down to the buyer and yourself and Halifax will have no input what so ever. The only part of the sales process that Halifax will have anty input on is that when the house does sell they will want their mortgage money back.

    If things are really that tight then I think selling may be your best bet

    • Post Points: 5
  •  Sun, Sep 16 2012, 12:23 PM

    Re: Unauthorised Mortgage - Halifax 'Consent to Lease' grey area

    I would suggest reading your new message that you switch to another bank and take on a new buy to let mortgage with another lender and solve all your problems.

    But then again you are living in a converted flat which may cause you problems to remortgage with any traditional BTL lender and I assume that you have less than 30% equity in your flat so you would not fall into the criteria of any buy to let lenders so you cannot make the switch.

    So basically you have a problem, you are struggling to sell your property, your property is only for renting, you are in a property that has little or no equity, you have a mortgage that is the highest possible risk to any lender and yet you expect your existing lender to give you record breaking rates because otherwise it means that you are going to have financial problems because of a deal organised between you and your ex.

    If you want to solve this problem you need to drop your property sale price to an area that will make it interesting and attractive to buyers, yes it may be below where you want to sell but thats the market nowadays. just because everyone else advertises their 1 bedroom flat for 1 million does not mean that they will get that price. Be realistic in what you are asking for in a depressed market.

    Halifax are not going to help you out here but what they have given to you is exactly the same as they offered to you when you agreed to take out the CTL and you didnt see fit to complain about it then, only now when its actually biting you back because of circumstances. When you agreed to move out of the prperty and move someone else back in for a rental price you agreed to the CTL terms and conditions which in my opinion are extremely fair and generous with Halifax. You did not get a Buy to Let mortgage organised on your property even though you and everyone else in the country are keenly aware that the property prices have been dropping and now because you did not act at the right time you do not have enough equity in your property to now switch to another lender to get a better rate. How is this the fault of Halifax? How are Halifax being greedy when you have had this choice from day 1 but never acted upon it? How are Halifax being unfair when they sent you out a CTL pack which you will of course have read through and digested and understood and then signed to agree to its content.

    At what point have you been mislead by what has occured?

    The position you have found yourself in is unfortunate but the fault lies with nobody but yourself for the inaction you took while trying to keep a good low rate on your mortgage.

    The banks have not preyed on the unfortunate, they have their terms and condiotions which were not obligatory but in any way and could actually only be accessed if you specifically asked for them and even then you had to sign to agree to these terms for this special arrangement. You did not act in your own best interest because you were so greedy to keep your own rate instead of organising yourself and paying a bit more but ensuring your financial future would be more reasonable.

    At the end of the day, if you had tried to remortgage right now then you would have got the 3.99% rate but you wouldnt have been able to have any tenanats into the property to give you rental. Instead you have had tenants in and you have had your mortgage covered, or mostly so. If you had no tentants then you would have been out by £650 per month but you would have kept your 3.99% rate. You could of course have just rented the property out without lender permission but this is illegal and then that would obviously make you no better than the scheming coniving banks that you feel have so ruthlessly scammed you. It should also be known that had your lender found that you were doing this then the weight of the law will fall to Halifax and they would insist that the mortgage be redeemed along with a financial penalty for any interest that had been lost on their behalf, they would also place a fraud marker against your name (and your ex partner)and you would find even things like car insurance and home insurance will suddenly become 10x more expensive over nitght and for the rest of your life because you had commited fraud. Hundred of people are now beuing caught in this trap so be grateful you went down the lawful route at least

    Your in a bad position but the banks aren't to blame. The housing market is showing small signs of recovery but until it becomes more manageable you are just going to have to suck it up or sell the house in a low market

    • Post Points: 5
  •  Sun, Sep 16 2012, 12:17 PM

    Re: Unauthorised Mortgage - Halifax 'Consent to Lease' grey area

    you call that generous? the gentleman is already paying his mortgage, HALIFAX want extra money for no apparent reason after he has been paying loyaly since 2004, Generosity is a word that should never be used, a mortgage is a business transaction, you don't get it for nothing, its not generosity you have to pay for it , usually two to three times the value of a house no less , so we see who is being generous really, and as seen with the gentleman's position and many others, the lenders are taking more. that action you speak of bears no resemblance to what the lenders (banks in fact) are doing.

    "the bank cannot be held responsible for any loss in the value of the property and the choice to switch to switch is completely yours"


    i see no choice, the only option they make clear is that you HAVE to have a consent to lease mortgage at the higher rate, or your property may be at risk because you may be committing mortgage fraud if you don't fess up.
    where is the choice there? there is no choice at the moment. Undervaluing is making sure of that.

    SELL... I would have to say, if only I could sell, i cant because of Ridiculous undervaluing.
    for instance ..you lent me £130,000 , now your saying that's only worth £105,000 i forgive you for not remembering the house itself has not changed physically, in fact for the better as its been rebuilt , redecorated, loved. yet you take your pieces of paper and mark DOWN the value.
    How is one supposed to sell?

    • Post Points: 20
  •  Sun, Sep 16 2012, 12:21 AM

    Re: Unauthorised Mortgage - Halifax 'Consent to Lease' grey area

    i dont understand the 'unauthorised' bit. they will grant you consent to lease, your equity does not matter, they should grant you consent to lease on your normal fixed/variable product because of your situation, you wont get a BTL, but you keep your normal fixed rate , they grant you consent for perhaps upto 3 years. it is going to cost more because at the moment they are swindling everyone in the same position as you into paying 5.69% + the base rate = (6.19%) thats what i was offered.
    where as the current variable rate is 3.99% (what you could have had if you was living in the prop on VAR rate).

    they are purposely undervaluing properties, so
    A; you cannot sell
    B: you cannot have a 4.84% BTL mortgage because your equity has MIRACULOUSLY disappeared.
    C: they make more money from you from a higher rate mortgage = fixed rate mortgage + consent to lease granted= at least 6.19%

    if anyone does not believe they are doing what they are doing purposely, then open your eyes. what HALIFAX has chosen to do just now..... its horrifying that banks can actually do this under law , whereby they manipulate property values to achieve a greater number of people into higher rate products. they under value purposely so they can hold onto the business....... by getting a leech hold on your cash from higher rates.

    what ever happened to Choice?


    i complained to the halifax by phone, the lady told me ' all the lenders are doing the same' i said 'does that make it right lady?'

    i am in a similar situation, but not entirely the same.
    I brought in 2007 Halifax 5 year fixed rate 130k flat. with my then girlfriend

    we split up 2011, she moved into a rented flat, and i stayed and payed all the mortgage £819 (6.9%apr)
    as life works out i got another girlfriend, and a different job which required me to be in the midlands.
    i tried for about 8 months to sell my flat, had a few viewers but it didnt sell (cant have it all!)
    I would have payed the X half any equity naturally, i just wanted shot of the place, makes it easier to split.

    I became, 'an Accidental landlord', or as halifax think , another poor mug we can rip off.

    Because i couldnt sell, i decided to try and rent, its only a small 2 bed flat, with the mortgage bieng allready high, i will never be in profit . I had gained consent to lease for 6 months, and succesfully letting it out for 650, taking into account the managing agent fees and landords building insurance ( i am afraid i am also the freeholder on this prop!) being a converted semi into two flats i got the first flat sold with the freehold. to cut a long story short it has cost me 250 PCM to uphold the mortgage, while i try and continue with my life.

    I understand its an agreement i entered into to, I understand the world will not fall at my feet.

    now (this week) after leaving a 5 year fixed rate.. halifax will not let me enter another consent to lease agreement without fixing for 3 years at there slightly reduced rate of 5.69% (+0.5% BofE base rate ) = 6.19%
    so.. the new mortgage is £770.
    so again, i am either faced with selling (which we all know is very tough) and nigh on impossible because of ridiculous under valuing (its just a figure on paper), or putting another £200PCM into this place for another 3 years.

    £200 a month for a property investment? thats pretty good i hear you say? . No, considering i have to give rightfully 50% of any equity to my X GF when it sells, i would have invested another 7400 in the three years, PLUS any property remedial work etc.

    assuming i get lucky.. call it £8000.
    I have to make that £8000 when it sells, to break even, plus, anything else i make i have to split.

    so if it sells for £125000, (5k below brought value) being optimistic here, and there is £115000 mortgage left.. £10,000 made will have cost me £8000 in payments over the last 3 years to have a chance of returning that, that leaves my X with a thousand quid, and me MINUS £7000.

    ANY COUPLES READING THIS THINKING OF TAKING A MORTGAGE , THINK TWICE! it seems the banks take full advantage of people that are unfortunate enough to want to MOVE HOUSE, or SELL, or Get on with your personal life without paying through the nose.

    my answer is easy, i am hopefully going to sign it all over to the X for free, she can move back in and pay the reduced variable rate, or i will sell it. either way, absoloutely no way i am giving any more money to the HALIFAX with their extortionate ways.

    as far as i'm concerned its final suicide.

    seems they prey on the unfortunate. I really hope that there are some young couples who can see mortgages for what they will be, when you try and split up, (unfortunate fact of life sometimes!, not always ;-) its a mugs game!. And the banks should be bloody ashamed.
    • Post Points: 20
  •  Fri, Sep 07 2012, 8:24 AM

    Re: Unauthorised Mortgage - Halifax 'Consent to Lease' grey area

    Halifax are very generous in their terms for Conmsent to Lease and it is all fully explained in their Consent to lease pack that is sent out with the agreement to switch to CTL.

    The bank cannot be held responsible for any loss in value on the property and the choice to switch over is completely yours.

    It is unfortunatelt that you asre now in a position that you cannot switch from a commercial rate to a residential rate but had you taken a Buy to Let product at the time then you would most likely have found yourself in a similar position facing a high Variable rate with a BTL lender.

    The other option of course as Maxsteam has suggested is that you sell the house

    • Post Points: 26
  •  Thu, Sep 06 2012, 3:35 PM

    Re: Unauthorised Mortgage - Halifax 'Consent to Lease' grey area


    This situation is really worrying and I dont know what my steps should be.

    Another option to consider is to put the property on the market. It might be better to sell the property tenanted as it could take a while to sell. It would be easier to sell if you were in the UK but you need to also consider whether it is better to put the property on the market now or pay the higher interest rate for the next few years.

    • Post Points: 20
  •  Thu, Sep 06 2012, 5:15 AM

    Unauthorised Mortgage - Halifax 'Consent to Lease' grey area

    Hi all,

    I have a property I have had since 2004 on a residential mortgage and have rented it out since 2006. Keeping the story short, I got made redundant, and got offered a position in Australia where I have been ever since.

    I have kept the Halifax informed of this since 2009 when I had a found out you needed consent to lease. They had let me carry on with the same arrangement on my SVR until this week (2012) when I received a letter asking for confirmation if property is still let out. They mentioned that they will be raising my rate by 1.5% if I do not get consent to lease authorisation from them.

    When I looked into Consent to Lease with Halifax, I do not have enough equity in my property (lost 30% of value) to go on to this product, and if I did, they would raise my rate to over 6.5%. This leaves me in a situation where I cannot re-mortgage elsewhere, cannot afford their BTL product, and are being forced to go onto a higher rate with them but with an UNAUTHORISED consent to least status.

    This situation is really worrying and I dont know what my steps should be. Any advice would be appreciated.


    • Post Points: 35