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Consent to let

If you have a residential mortgage and are looking for permission to rent out your home for a short period of time, you’ll need a consent to let agreement from your mortgage provider.

Here’s what you need to know.

If you have a residential mortgage and are looking for permission to rent out your home for a short period of time, you’ll need a consent to let agreement from your mortgage provider.

Here’s what you need to know.

Written by
Alex Hasty
Insurance comparison and finance expert
Last Updated
26 APRIL 2023
6 min read
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What is consent to let?

Consent to let is a formal, written agreement between you and your mortgage lender, giving you permission to rent out your home for a short period of time. Consent to let is the only legal way you can rent out your house on a residential mortgage.

It’s vital to get your mortgage lender’s permission before you consider letting out your home. Without their go-ahead, you’ll be in breach of your mortgage contract, which could be considered mortgage fraud. Your lender could demand that you repay the entire mortgage immediately and may even repossess your home.

Consent to let is not a permanent change to your mortgage agreement and it’s definitely not a long-term letting solution. If you intend to rent out your property long-term, you’ll need to convert your mortgage to a buy-to-let mortgage.

What valid reasons are there for consent to let?

There’s a few reasons why you might need consent to let. Usually, lenders are happy to help if:

  • You need to temporarily move for work or have accepted a short-term work contract overseas.
  • You’re moving in with a partner and want to rent out your existing home while waiting to sell it.
  • You’re going travelling for a few months.
  • You’re moving in with a relative who needs care.
  • You’re a member of the Armed Forces and have a tour of duty in another country.

When might consent to let be refused?

When you apply for consent to let, it’s not guaranteed that permission will be granted. There’s usually a few conditions that you’ll need to meet. For example, your mortgage lender might insist on the following:

  • Your mortgage payments need to be up to date and paid on time, with no arrears.
  • You must agree to rent out your property on an assured shorthold tenancy.
  • You can only rent out your property on one tenancy agreement.
  • You can’t apply to borrow more on the property while it’s being rented out.
  • You must tell your home insurance provider about the new mortgage arrangement as it could affect your cover.

There might be other conditions as well, depending on the lender. For example:

  • You might only be able to apply for consent to let if you’ve held a mortgage with the lender for at least six months.
  • No multiple tenancies and a maximum number of tenants on one agreement – for example, up to five people.
  • You might need a certain level of equity in your home – for example, at least 25%.
  • You might need to meet a minimum income threshold.

Can I get consent to rent out a Help to Buy property?

It’s highly unlikely you’ll get permission to sublet a property on a Help to Buy mortgage. One of the clauses under the Government’s Help to Buy Equity Loan scheme is that you’re not allowed to rent out your property.

If you want to sublet, you’ll need to pay back the Help to Buy equity loan first. The only possible exceptions are members of the Armed Forces who are away from home on a tour of duty. In exceptional circumstances like these, permission to sublet may be considered.

Is it illegal to rent a house without a buy-to-let mortgage?

If you have a residential mortgage and you rent your home without your lender’s permission, you’ll be in breach of your mortgage contract. This amounts to mortgage fraud, which is essentially breaking the law.

If your lender finds out, you could find yourself in hot water. They only need to check the electoral register or past letting advertisements to uncover the fraud.

The consequences can be serious. At the very least your lender could charge you a penalty and raise your mortgage rates. Or they could take further measures and demand you pay back your mortgage loan immediately. If you’re unable to, they could repossess your home.

In short, it’s not worth the risk.

Your home may be repossessed if you don’t keep up repayments on your mortgage.

Can I rent my property to family?

It depends on the lender. Some mortgage providers won’t give consent to let for family and you may need to apply for a specialist family buy-to-let mortgage.

What are the costs of consent to let?

Consent to let is by no means cost-free. There’s a number of extra expenses that you’ll need to factor in before renting out your home.

Lenders will usually charge you an extra percentage rate on top of your normal mortgage rate or a one-off fee. Some lenders charge both.

There are also additional costs to consider when you become a landlord, even for a short period of time. These can include:

  • Landlord insurance
  • Tax on your rental income if it’s over £1,000 a year
  • Letting agency fees
  • Maintenance and repair costs
  • Legal fees for drawing up contracts.

As a landlord, you’ll also have responsibilities and obligations when renting out your property, including:

Consent to let: pros and cons

If you want to rent out your home for a short period of time without breaking the terms of your mortgage contract, then consent to let can offer some obvious benefits. However, it doesn’t come without risks or costs.

Here’s a quick breakdown of the pros and cons of getting consent to let:

Advantages of consent to let:

  • Gives you time to move without the added burden of two mortgages to cover.
  • Can provide a rental income while you’re away travelling or working.
  • Gives you peace of mind that your mortgage payments are covered.
  • A good way of ‘trying out’ renting without having to commit to the strict buy-to-let mortgage rules.
  • A lot quicker and more straightforward than having to remortgage.

Disadvantages of consent to let:

  • If you can’t find tenants, you’ll still have to cover your mortgage repayments.
  • You’ll be charged a mortgage fee or a higher interest rate – possibly both.
  • Associated costs can be expensive and may outweigh any profits from your rental income.
  • Being a landlord comes with a fair amount of responsibilities and obligations.
  • Short-term tenants might not be as careful and considerate with your home and furnishings as you are.

 

How long does consent to let last?

Lenders normally only give you permission to rent your home for a certain length of time: typically, six to 12 months, but in some cases up to 24 months.

When the agreed lease permission period ends, the conditions of your residential mortgage will go back to the same as before.

If you want to continue renting out your property, your lender might be prepared to extend the consent to let or they may offer to convert your existing mortgage to a buy-to-let mortgage.

This doesn’t mean you have to accept your lender’s offer. If you decide to switch to a buy-to-let mortgage, you might want to shop around and compare what’s out there to see if you can get a better deal.

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Frequently asked questions

Will I need consent to let if I have a lodger?

Yes, it’s most likely that you’ll need permission from your mortgage lender, even if you’re just renting out your spare room. If you take in a lodger without permission, you could be in breach of your mortgage contract. Your lender may insist that you ask your lodger to leave and could even take legal action against you.

How do I get consent to let?

You’ll need to contact your mortgage lender directly. In most cases, you can apply for consent by phone or online via your lender’s banking website or app. If you’re a joint mortgage holder, you’ll both need to agree and apply for consent together. 

Are consent to let fees tax deductible?

Yes, any costs you’ve incurred that are wholly and exclusively for the purpose of renting out your property are tax deductible. These can include:

  • Letting agent fees
  • Accountant fees
  • Buildings and contents insurance
  • Gardening and cleaning services
  • Maintenance and safety fees – for example, gas inspections and boiler service.

You should also be able to get a 20% tax relief on your mortgage interest payments while your property is being rented out.

Do I need permission from my home insurance provider to rent my property?

While you don’t need ‘permission’ from your home insurance provider, you do need to tell them if you’re planning on renting out your home.

Your standard home insurance policy might be invalid if you rent your property to tenants. Your mortgage lender might also insist you have specific landlord insurance in place as a condition of their consent.

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The content written in this article is for information purposes only and should not be taken as financial advice. If you require support on the products discussed here, please speak to your bank/lender or seek the advice of an independent professional financial advisor. We also have more information on our Customer Support Hub.

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