Advice needed on renting out home but I dont want to lose tracker rate ?

ajapale

Moderator
Messages
7,723
eddie,

I reckon if you breach the T&C's all of them will force you off the tracker.

aj
 

Creditlimit

Frequent Poster
Messages
59
I'm in a similiar predicament as many previous posters and based on my current tracker rate I would stand to pay €315,000 more in interest if I was placed on the highest variable interest rate!!!
The banks are loosing a fortune on tracker rates and it seems likely that will enact some legal loophole to wriggle their way out of it whenever possible. It seems like a big risk to take...
 

Oilean Beag

Frequent Poster
Messages
221
I am on a tracker with PTSB and when I raised this question with them 1.5 years ago I was advised on the phone that I would not loose my tracker by renting out my house HOWEVER two weeks later I got a letter from them stating that if I rented out my house I WOULD loose my tracker rate and asking me to confirm to them that I had not moved out. I quickly confirmed that I did not and still have my tracker.

I still live in the house but if I didn't I would be pretty anxious that given the recent media coverage re banks trying to get out of trackers that they will be examining accounts where TRS has been cancelled and pulling trackers from those customers.
 

muffin1973

Frequent Poster
Messages
632
We're thinking of possibly renting out our house too, also on tracker (with UB). Know will have to register with the PRTB but the bank can't find out about that can they? Also, why would you cancel TRS if you're just going into rented property? (sorry I understand TRS to be Mortgage interest relief?).

M
 

txirimiri

Frequent Poster
Messages
173
If you don't cancel it, you will be illegally claiming a tax credit that you are not entitled to and Revenue will take a dim view when they find out! TRS is only for your PPR and once you rent it out, Revenue considers it an investment property. Doesn't matter if it is the only house you own and if it is considered a family home under the Family Home Act. Make sure you are up front with Revenue about this if you do decide to rent it out
 

DrMoriarty

Moderator
Messages
5,180
I dont understand why you asked them the question to begin with? If the mortgage is paid every month your bank will be happy - bottom line.
you dont need to tell them, dont cause unnecessary hassle for yourself
Better to seek forgiveness than permission
With all due respect to the posters concerned, I'd urge you to ignore this advice. As Oilean Beag's case demonstrates, banks would be only too delighted to see someone unwittingly breach the terms of their mortgage and relinquish their tracker rate. Your bank has advised you explicitly what will happen if you move out and rent your home, so your options are pretty simple:

(a) keep it as your PPR and rent rooms, or
(b) give up your tracker.

You'd need to sit down and do the maths, but my hunch is that the long-term cost of losing your tracker would very substantially (depending on the size of your mortgage) outweigh the rental gains over 18 months, or even longer.
 

csirl

Frequent Poster
Messages
2,162
We're thinking of possibly renting out our house too, also on tracker (with UB). Know will have to register with the PRTB but the bank can't find out about that can they? Also, why would you cancel TRS if you're just going into rented property? (sorry I understand TRS to be Mortgage interest relief?).

M
Claiming TRS that you are not entitled to is tax fraud. You can be prosecuted for it.
 

mathepac

Frequent Poster
Messages
6,708
... Know will have to register with the PRTB but the bank can't find out about that can they?...
Property addresses registered with PRTB are published (eventually) on the PRTB web-site in county-by-county lists.
... Also, why would you cancel TRS if you're just going into rented property? (sorry I understand TRS to be Mortgage interest relief?)...
TRS is only available for your PPR. If you have an investment property you can off-set 75% of the mortgage interest paid as an expense when calculating your profit.
 

Mixednuts

Frequent Poster
Messages
166
If you don't cancel it, you will be illegally claiming a tax credit that you are not entitled to and Revenue will take a dim view when they find out! TRS is only for your PPR and once you rent it out, Revenue considers it an investment property. Doesn't matter if it is the only house you own and if it is considered a family home under the Family Home Act. Make sure you are up front with Revenue about this if you do decide to rent it out
If your TRS has expired then no issue .

Why are some banks telling customers its not a problem to rent out and hold tracker ?
 
S

son of riker

Guest
Can I ask anyone here if they are with Aib? I moved out of my apartment three years ago. All legit with the state. I changed address with Bank-statements go to new home. Apartment is rented. I rang them today anonymously and made a general enquiry-they said Im safe. I cant find my original tracker agreement or letter.
 

jigsaw

Frequent Poster
Messages
92
has anybody had any experience with ulsterbank and renting their house out?

did they allow you to stay on the tracker?
 

Troy McClure

Frequent Poster
Messages
300
Did UB not give you a T&C?

Why dont you do like the previous poster and make an anonymous call to their mortgage section and ask them?

Dont forget to let us know how you get on..
 
S

surfineddie

Guest
another angle

If you rent out the house does it loose family home status from a future sale vewpoint. We lived in this house for 12 years. Recently rented it out. Im back with parents, partner is in rented accomadation. We are seperated obviously. Prior to this we could have sld the house and kept any profit tax free. How long after we rent it out do we loose this concession or is it immediate?
 

nek

Frequent Poster
Messages
17
If you cancel TRS on the mortgage account, that would also be a flag to the lender. If the tracker rate is dependent on you living in the property and it's vital to you to hold on to the tracker, I wouldn't chance moving out in the hope that they won't find out.

Can you rent out a room instead and stay in the house?

i think watersprite makes an interesting point, they could just ask you for your insurance details,
if they do catch you, would you have to pay back arrears?
 
F

FTBtracker

Guest
Hi,
I am an unfortunate new landlord in the same predicament.
Large negative equity and need to move house due to job/family reasons.
I can't believe we have been in a recession with a sever housing problem now since 2008 and the Government still hasn’t addressed these issues- (another forum discussion I imagine).
I cant find a definitive answer anywhere to the question “if I rent my FTB house out, will I eventually loose my tracker”?
For me the main question is “if I inform the Revenue to cancel my Mortgage Interest relief do they inform my Mortgage provider automatically?”….. (I am aware some people get the tax relief off their mortgage monthly payment directly from the Mortgage Provider. Alternatively some people get the relief as a credit in their bank account separately).
For me I get it as a credit separately into a different bank to my Mortgage Provider Bank.
This is the most stressful worry for people that need to move for genuine reasons, but are now locked in a negative equity/mortgage/tax trap. Rob
 
Top