Living in the house right now is not an option, neither is selling as we would be in negative equity, but without the income from the holiday letting we cannot meet our mortgage and rental costs. I do not know what to do and would gratefully welcome your advice. MR
Retirement dreams: But if your plans are put into disarray, mortgage lenders may not allow you to let a property you can't move into.David Hollingworth, of London & Country Mortgages, replies: A standard mortgage for owner-occupied residential properties will specify that the property should not be let.
Therefore, letting the property without the lender's consent does mean you have breached the terms of the mortgage.
The lender is under no obligation to give consent to you letting the property and even if they do they may charge a fee or a higher interest rate.
I think you need to enter into further dialogue with your existing lender to see whether a compromise can be reached, ideally giving you consent to let the property for a period, even if it is at a higher mortgage rate.
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Emily Spaven, of This is Money, adds: If your current mortgage provider is unwilling to switch you to a buy-to-let mortgage, see whether another lender would be willing to offer you one.
This may not be easy as buy-to-let lenders are often not keen on holiday lets because of the potentially seasonal nature of the income.
Buy-to-let lenders will typically require you to have at least 25 per cent equity in your property.
If you do find a lender that is happy to accept holiday lets, there may be conditions surrounding the level of equity you have in the property.
If all goes well and you find a lender that is willing to give you a buy-to-let mortgage, remember to factor in the charge for leaving your current mortgage early.
Simon Lambert, of This is Money, adds: You appear to be stuck in an impossible position in terms of moving lenders as you say your home is in negative equity - and thus you cannot meet loan-to-value requirements.
That leaves you with two choices, sell up and take a loss, or stick with your existing lender. Exploring the latter option as much as you can would be the least financially painful option.
To do that you need to speak to your mortgage lender and explain the exact situation to them, laying out where you stand and also giving them some assurance that you do still intend to live in this property. Explaining your finances, the letting commitment and contract and your husband's work position should all work in your favour.
You may need to be open to changing tack, for example, letting it longer-term on an assured shorthold tenancy rather than as a holiday let may swing it for the lender switching you to a buy-to-let loan.
Your mortgage lender will not want to repossess you or force a below mortgage value sale, as it may not then get its investment back.