Key Post Has anyone lost their tracker through renting out their home?

Brendan Burgess

Founder
Messages
38,699
A few posters have referred to people losing their cheap trackers if they let out their home.

Is there a definitive answer on this?

Do the terms and conditions usually specify that it must be your home/

Brendan
 

Brendan Burgess

Founder
Messages
38,699
Summary of responses in the thread


  • Unless your contract specifies that you will have to pay an investment property rate, you will not have to pay it.
  • NIB's contract specifies that you will move to the investment property rate
  • KBC has moved this customer to an investment property rate - although it's not clear why they did it
  • Other KBC customers retained their favourable rate
  • Ulster Bank/First Active leave you on the tracker but "reserve the right to change their stance" on this issue.
  • No customer of any other bank has reported having their rate increased.
  • PTSB has confirmed to many people that they won't lose their tracker. One poster managed to get it in writing. They change the classification to "investment property" which means that you are no longer covered by the Mortgage Arrears Code
  • Bank of Ireland/ICS allow don't change the rate either
Should I notify the bank that I have let my house out?
The contract usually specifies that you should notify your bank if you let the house. However, there doesn't seem to be any penalty for not notifying them.

Some such as Ulster Bank/First Active say that you can't let it out without their permission.

Should I get their confirmation in writing that I won't lose my tracker?
PTSB will give you this easily, so it's no harm to ask to set your mind at rest.

Opinions are mixed otherwise with most people suggesting that you might be opening a can of worms.

But won't they know when I notify the Revenue to stop the TRS; register with the PRTB or when I notify the insurance company that the property is let?
You must do this anyway. It seems that the banks don't follow up on such notifications.

AIB's contract says that I can't let out my house
In practice, this means very little or, if it does, they don't enforce it.

If the rent is less than €10,000 could I claim the rent a room scheme?
Under the Rent a Room scheme, the house must be your Principal Private Residence. So this is not a runner.
 

twofor1

Frequent Poster
Messages
1,290
Do the terms and conditions usually specify that it must be your home/

Brendan
One of the conditions for my NIB LTV Tracker states;

‘’The property upon which your loan is secured must remain your Principal Private Residence for the life of your loan. If such property ceases to be your PPR we reserve the right to convert your LTV rate to our then applicable Investment Home Loan rate (fixed or variable as the case may be). You must certify to us that the property is your PPR at date of drawdown and on the date of any renegotiation’’
 

daymoh

Frequent Poster
Messages
51
I have a residential tracker mortgage with PTSB..Took out the mortgage in 2005. I can't see any terms or conditions in my mortgage paperwork stating that I have to switch my mortgage if I rent out my place. On 2 occasions I've contacted the mortgage dept regarding my tracker about what would happen if I were to rent out my property. On both occasions I was told that I could rent out my property without being forced to switch mortgages.

When I asked them if they'd send me a letter stating this, they said they couldn't.. What action can I take to get the confirmation in writing? I would hate to be caught out a few years down the road..
 
M

mollymalone

Guest
Just to confirm the statement above about NIB, I was talking to them today and they said that I would certainly lose my tracker mortgage if I rented out my house, because the loan agreement was for a PPR. I read today in the Irish Times that Bank of Ireland are letting people keep their tracker if they rent their house. Lucky BOI customers, in this case!
 

RichieRich

Registered User
Messages
31
Daymoh mentioned having a ptsb tracker, I'm in the same boat and checked my letter of approval's conditions - no mention that I have to live in the house myself. I rang ptsb a while back and was told I wouldn't lose the tracker if I rented out, rang a fortnight later and was told it would switch to investment rate! I don't think the customer care agents know themselves. Anyone have any experience with a ptsb tracker and renting out?
 

daymoh

Frequent Poster
Messages
51
Triple checked again today with ptsb and they said that if I rented out my property, it would be classified as an investment property but my rate/mortgage wouldn't change. All that would change is that I would lose my mortgage interest relief.
 

Macstuff

Frequent Poster
Messages
229
I too am with NIB and have the same clasue as twofor1 i.e. "The property upon which your loan is secured must remain your Principal Private Residence for the life of your loan. If such property ceases to be your PPR we reserve the right to convert your LTV rate to our then applicable Investment Home Loan rate (fixed or variable as the case may be). You must certify to us that the property is your PPR at date of drawdown and on the date of any renegotiation’’.

I plan to rent out my property, starting later this month. I don't plan to tell NIB - as I simply can't afford the higher repayments.

I believe the only way they can find out is via the Insurance Cert. / Insurance Schedule.
The insurance is currently with FBD and it doesn't mention whether the house is rented or not.
I currently live in the house and the house is insured as my PPR. However, the Insurance Cert / Schedule they sent me doesn't detail this.


Once I move I will tell FBD of the change of status. Will my new Cert / Insurance Schedule reflect this change?
What's normal practice with regard to Insurance Certs - do they normally state if its a PPR or Investment etc.
 

philcsl

Registered User
Messages
18
TSB Tracker

I have a tracker with Permanent TSB, when I enquired through my bank branch and mortgage centre I was told by 3 different people that I would definitely be moved to an investment rate (SVR).

I re-read my mortgage agreement and there was no mention it had to be my PPR, I challenged the bank on this and they finally agreed that there was no clause and they sent me a letter confirming that I would retain my tracker and just advised me to insure the property as an investment property and to notify revenue to remove TRS

While reading through the original loan agreement I noticed the original tracker rate was .5% lower than the actual rate I got when moving off a fixed rate and they eventually had to refund me €1700 and amend the rate so it turned out to be a good thing that they gave me the wrong info at the begining!!
 

River

Frequent Poster
Messages
153
Hi,
I have my mortgage with AIB and will be renting my property out as I'm moving abroad. I read the T&C's and there is no mention of losing my tracker rate and no mention that property must remain my PPR. I took my mortgage out in 2006. However there does seem to be some conflicting opinions on different message boards as to what lenders are saying.
Has anyone experience with AIB's response if I was to notify them I am due to rent out (so as to cancel my mortgage interest relief)?

Thanks,
R
 
B

blueflower

Guest
I am also interested in this.

I want to rent out my apartment which is on a tracker (and in neg equity) and rent a house.
I contacted my bank today and was told "why would you tell us, you will lose your tracker". I explained that i hope to go with a letting managment co. and so they will do everything by the book and he seemed to think that this was not a good idea.

I don't want to be underhand and I understand that i will lose my tax relief and this is ok.

My questions are:

Can I 'rent out a room', for 10,000 a year - i.e. no more than 833 per month to stay within the rent a room tax relief amount? I would be moving into a house. Is this acceptable?

Should i just say nothing and pay the tax relief back at the end of the year in a tax return form? (Is this even possible)?

I appeciate all replies.
 
B

blueflower

Guest
Thanks for the reply. that is a very interesting link, it seems that a lot of people are in the same position. Like them i intend to pay all the relevant fees and discontune the TRS, but have the same problem with telling the bank about the apt not being my PPR.

Re the rent a room - if theoretically I keep one of the rooms for my own use, could I do that?

If not, judging by that thread from the link, I could just rent it out, get all my post sent to my new address with the exception of the mortgage-related post. Then I could keep the tracker.
My insurance is a block insurance through the management fees, so I don't think this is affected.

The latter option is what the bank employee on the phone advised me to do. He said I would be mad to tell them, and that they are not going to come to my door to check if I am there. I was surprised by that reply!

I am worried about discontinuing the TRS - do I just ask revenue to stop it, or do I write them a cheque at the end of year?
 

dewdrop

Frequent Poster
Messages
1,299
Re the rent a room scheme it is clearly stated that the property must be occupied by you as your principal private residence.
 
B

blueflower

Guest
If you tell the bank to stop your trs then they will know you are most likely renting out the property. If you don't tell them and continue to claim trs you are defrauding Revenue. Your interest statement at the end of the year will show how much trs you have claimed. I don't know (but doubt) if Revenue would just accept you paying them this back - and you will end up with the same problem next year. Caught between a rock and a hard place tbh.
I wonder if anyone has done this?
I might phone the bank back tomorrow and ask about d/c TRS. As I said the guy today told me not to tell them.

Re the rent-a room then I guess that woldn't work as it wouldn't be my PPR.

I have looked though any information I have about the mortgage and I can't see reference made to losing the tracker, but I think that I must be missing the small print document. I might go to my original broker and see if they kept a copy of the conditions.
It was EBS and I bought in 2004/5.

Thanks again for the replies.
 
D

deemark

Guest
I'm in this boat too - bought property in 2005, lived there til 2007 and only upon marriage in 2009 did (nearly) everything by the book - registered with PRTB, cancelled TRS, paid NPPR, registered for income tax, the whole shebang.

Now, I'm worried about my tracker - the bank still thinks I live there. I've contacted UB FOUR times looking for my T&Cs, but no joy. I'm afraid (and probably paranoid) that if I put pressure on, they will start to ask questions, figure out that I no longer live there and take my tracker off me. My further fear is that if they knew this, they would backdate payments I should have made on a variable rate - is this possible? Does anyone have experience with UB's Ufirst Tracker Mortgages?

I can shed a bit of light on cancelling the TRS though: UB never noticed or queried why it was cancelled. However, as it took me a few months to do this, Revenue looked for the difference back and I got a nice bill from them:(
 

CrazyOne

Frequent Poster
Messages
60
Hi just wondering if there are any updates on this? Also a post mentioned that B of I would not take your tracker if you rented - does this apply to ICS too?
Won't be able to keep up mortgage payments but if they agreed to interest only and we rented out the house that would cover it - but not if they took back the tracker......
 
D

derek1976

Guest
Like deemark, I also have a Mortgage with UB's Ufirst Tracker Mortgages.
In the next month or two, might be forced to rent out my current home due to work commitments. Will be interested to see how this tread goes, as I'm have been trailing through my contract and House Insurance Policy to see if tracker will be impacted.

Has anybody else got experience when on a with UB's Ufirst Tracker Mortgages, and has to rent out private property.
 

tool

Frequent Poster
Messages
28
I have a First Active tracker. I am also interested to know the impact of renting my house? I have reviewed all my mortgage paperwork and my loan agreement. I don't thinking I am missing anything but I can't located the signed contract? I have a loan agreement doc that isn't signed. I have requested a copy of the contract from First Active? I am very worried about this? Does anyone have any experience/advice of First Active tracker mortgages?
 

tool

Frequent Poster
Messages
28
My First Active (now Ulster bank) mortgage contract makes no mention of "tracker" in the contract. It just calls it a variable rate. It states that after 12 months the rate will change to ECB + 1.15%. A few years ago I negotiated a lower LTV rate of 80% by paying in a lump sum. My current rate is ECB + 0.75%. Now that the market value has decreased could UB increase the tracker back up to the higher rate when ever they want? If so then why haven't they done it already?
 
Top