Pitfalls of a “normal” mortgage for a BTL

[Jag_NE]

I am acutely aware that this will involve fibbing but the obvious benefits are a much lower deposit and a lower interest rate. Tell me what can go wrong please!

[98elise]

By fibbing you mean fraud?

Apart from that won't the mortgage company send all your correspondence to the property. For a BTL mortgage they expect a separate correspondence address.

[GT03ROB]

as 98elise says committing fraud with financial institutions is rarely a good idea. Would they ever find out who knows, but is the risk worth it?

[Evolved]

What could go wrong. I’m sure there’s tons of people doing it.

[Jag_NE]

98elise said:

By fibbing you mean fraud?

Apart from that won't the mortgage company send all your correspondence to the property. For a BTL mortgage they expect a separate correspondence address.

Yes, the paperwork would need to go the address.

I’m less interested in the moralising of fibbing/fraud, more specifically what could go wrong so I can gauge the risk vs the reward.

[anonymous-user]

As a mortgage underwriter I can confirm we can usually quite easily identify a hidden BTL at the application stage so there's a good chance it'll just be declined.

[Jag_NE]

Sten. said:

As a mortgage underwriter I can confirm we can usually quite easily identify a hidden BTL at the application stage so there's a good chance it'll just be declined.

Thanks. What about beyond that point?

[Sarnie]

Lenders carry out spot checks on a sample of all mortgages, 3-6 months after completion.......it's pretty easy to spot that you aren't living in the property and other people are........electoral roll info.......Rightmove adverts for the property....

[mike9009]

There are only upsides to Fraud. I wouldn't worry.

[Jag_NE]

Sarnie said:

Lenders carry out spot checks on a sample of all mortgages, 3-6 months after completion.......it's pretty easy to spot that you aren't living in the property and other people are........electoral roll info.......Rightmove adverts for the property....

Thanks. Electoral roll is a good one to watch out for.

Will anyone admit to doing this and if it went well / not so well

[untakenname]

They could also put your main residence on BTL mortgage rates as well.
Parents friends had it happen with mortgage express after they were found out and took a long time to sort out, he rates were 5% above the normal residential mortgage rate!

[98elise]

Insurance. For a BTL you will need landlord insurance rather than residential. Your mortgage lender might want to see your insurance certificate as they will want the building insured.

I have been asked in the past, but not recently.

[rossub]

I got away with it, but it was 12 years ago and I only had it 2 years. It was my only property though, as I lived in the gf’s flat. Sold it to buy a house with her.

Was a 100% Northern Rock mortgage too!

[Jag_NE]

Thanks guys. Some great input to weigh up.

[Stella Tortoise]

Is this a mortgage fraud tips thread?

[Jag_NE]

Stella Tortoise said:

Is this a mortgage fraud tips thread?

Yes.

[NNH]

The easiest way to "get away with it" is to actually live at the property for a little while, and then rent it out when you move. I've done that, and I'm sure there's a lot of other unintentional landlords.

[FukeLreeman]

When we bought house no2 we still had 2 years with lender on current house. We just had to fill in a form and then we was allowed to rent house no1 out.

[Jag_NE]

Thanks lads. Realistically I could be “living” there for a while as I refit and decorate, plus time to find a tenant etc

[skilly1]

What is the difference in monthly repayments?