Not paying btl mortgage

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    Not paying btl mortgage

    What's the worse that can happen If I stop paying a btl mortgage due to tenant not paying rent for 5 months and counting?

    #2
    The worst? Finding future loans & mortgages & credit agreements unavailable or very expensive in future.

    What's likely? I think if we survive this lot people will understand
    I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

    Comment


      #3
      I would suggest that you call your lender or ( see their web site for customers) and explain that your tenant is not paying the rent , dont elaborate of time unless asked and request a mortgage payment holiday , currently the Financial Conduct Authority is considering asking lenders to extend this for upwards of 6 months, the downside is that such Arrears will be added to your loan and when normal services resume you will start paying interest on the capitalised Arrears , something which overall could prove expensive but then get ready to hit the tenant with the relevant notice for him to get out.
      You clearly are in a desperate situation and I am indeed sorry for you. Once the holiday period expires then you will need to resume your payments otherwise repossession will eventually come into the equation.

      Comment


        #4
        Your property could be repossessed and it may become impossible to get a mortgage of any kind in future.
        Your credit rating will be poor.

        As above, lenders don't want to repossess unless they have to and a mortgage holiday probably suits them. I had a holiday on my home mortgage in a time of personal financial crisis, was ashamed to have to ask, but it was simply routine to the call centre I spoke to, and I went through weeks of stress that I needn't have.
        When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
        Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

        Comment


          #5
          These are indeed unusual times and certainly the poster has added complications of a defaulting tenant.

          You certainly have at least three months before the lender might formalise their concerns but before the property was repossessed they would appoint a Receiver of Rents who would try to manage out the issue and if the tenant voluntarily vacated they would then seek approval from the lender to return the property to you otherwise if the matter wasn’t resolved and the Arrears deteriorated then the lender would place it on the market including submitting it for auction.
          If possession was obtained then future funding would switch lenders who price their product offerings against the actual credit Insight of the applicant but the rates will not be prime irrespective of whether it is a home ownership or BtL application.

          Comment


            #6
            I have read today that no possession claims will be heard for 90 days (at least). So my tenant has another 3 months of sitting in my property while I get no rent and supposed to pay the mortgage for another 3+ months???

            Comment


              #7
              I've cancelled the DD , will see what happens

              Comment


                #8
                Originally posted by Propertygoesup View Post
                I've cancelled the DD , will see what happens
                It will be counted as an outright default. Why not at least contact your lender first?

                Comment


                  #9
                  Just so tired of it all , had to do something, payment holiday just means paying more later on

                  Comment


                    #10
                    Revert your DD to paying and for heavens sake make contact with whomever is your lender. Getting 3 months grace gives you a breathing space, I appreciate the stress that your tenant is causing you but look ahead , keep your lender and credit profile onside.
                    please Please confirm that you have done this otherwise you have lost both the battle and the war.

                    Comment


                      #11
                      Originally posted by Propertygoesup View Post
                      Just so tired of it all , had to do something, payment holiday just means paying more later on
                      Payment holiday means you remain control.

                      Default means you still have the hassle, the rent receiver takes control, their (deliberate?) incompetence is staggering, the asset is run into the ground, until a time of the lenders convenience and choosing,
                      eventually a vulture like me buys it for less than half your worse case estimate,
                      then everyone else gets their cut, but you still owe the original mortgage plus loan/legal shark fees plus the interest.
                      And it will take years.

                      Please, contact your lender.

                      Comment


                        #12
                        Originally posted by Propertygoesup View Post
                        Just so tired of it all , had to do something, payment holiday just means paying more later on
                        That was Friday night thinking!

                        When things get back to normal, you can evict the tenant, sell the property and repay the mortgage - even with the extra payments owed.

                        Commiting financial suicide is the worst possible option.
                        Everything that's bad about your current situation will just carry on being bad and worse things will happen that you are doing to yourself.
                        Contact your lender and take the help that they will offer.
                        You're a drowning man turning away lifebelts.
                        When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                        Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                        Comment


                          #13
                          Thanks for the advice I have realised that if I stop the mortgage I am effectively going down the with tenant , letting her win.

                          Comment


                            #14
                            Yes, good thinking.

                            Don't put off talking to your lender though.
                            Not having the rent is bad enough, but watching money going out at the same time is really frustrating.
                            You're going to sell once the property is back to normal, so a bit of extra interest isn't the end of the world.
                            When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                            Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                            Comment


                              #15
                              Thanks. I am angry at tenant not paying but I guess I could look at paying the mortgage out of my own money as effectively a savings account? With my interest rate at 2.69% I should really pay as much as I can???

                              Comment

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