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

Bronte

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Why not?

You are in breach of your contract if you are obliged to tell them that you are renting the property. Is this not tantamount to fraud?
Well a court would have to decide if not telling them it was now a rental is fraud, and I cannot see a court looking favourable on an ordinary person saying I 'forgot' to inform them about this fact. With financial climate of the last few years a change of interest rates would see people over the edge even further, my advice is in that vain.

Is it 'fraud' for banks not to inform people that they are entitled to trackers when fixed period ends?

In any case I don't see a bank taking someone to court to prove this 'fraud.'
 

Bronte

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Bronte, can we be clear about this as it's very important.

Did they know you rented it out and did they try to change the rate and did you successfully argue your case?

.
No they knew it was rented, and no they did not try on that property to change the rate. They did it on another property that was always a rental, but I don't want to give any more details etc.

Just look at the email response Jigsaw got, in blue. Why can't the bank just easily confirm to Jigsaw that they accept he's on a tracker and leave it at that. They just have to get their get out clause in and let him have to worry about it for the rest of his mortgage.
 

Brendan Burgess

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Charlie Weston covered the story in yesterday's Indo.

Banks turn blind eye to tracker holders who rent

Officially, the banks insist they will remove a good-value tracker from anyone who rents out their home as the homeowner moves from being a residential customer to being a commercial client.


However, evidence from a survey conducted over the last two years on Askaboutmoney.com shows that most banks have not opted to strip people of their trackers, even when they know properties are being rented out. Banking sources told the Irish Independent they were prepared to turn a blind eye to homes being rented out. This is despite the banks knowing the terms of the tracker deals are being contravened.

If their unofficial policy is to do nothing about it, maybe then it's best not to notify the bank?
 

jigsaw

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I've been thinking about Ulster Banks reply to my letter and just wondered if I brought my mortgage contract to a solicitor would they be able to scrutinise it and definitely tell me if Ulster Bank can remove my tracker if I rent out the property?
 

chrisblack

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I was on to PermTSB this morning... tele person advised that I would remain on tracker, and no mention of changing to investment property... but couldn't send me anything in writing.... just as long as payments are made on a monthly basis and don't go into arrears drive on???
 

MortgageGuy

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keeping your tracker

I am NOT saying that anybody should do this, merely pointing out that it's an angle.

If you only have one property in the state then it's dealt with as a PDH under the CCMA, even if you never moved into it (if for instance you were in negative equity when you closed).

If you were to write to your bank a letter saying that you were finding it hard to make ends meet but wanted to assure them that you will do your utmost to make every last payment then the onus is on them to put you into pre-arrears, they may not, they are busy dealing with actual arrears.

If having informed the bank of this you subsequently move out of the property and if queried simply let them know that you did it for financial reasons they were informed of then you are protected by the CCMA (not if you buy a new PDH though) and trackers are protected within that legislation even if the contract says otherwise.

the only way they tend to realise this happened is if you go back to them for a loan (don't) or you change your house insurance and send in a letter of indemnity which indicates its a RIP now (don't do that either). Simply have your insurance in place but don't send them a copy.

While this is in breach of some loan contract conditions it isn't one that will create a repossession.

Remember your ethics, don't do this kind of thing to abuse the system, but if you do it because you have financial difficulty then it's a way of protecting your tracker and worth looking at.
 

TRS30

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As part of a letter I received from Certus yesterday they have confirmed that I can rent my PPR and keep my tracker rate. My T&C's does state that they have the right to change the interest rate charged if I change the use of the property. My tracker rate is ECB +0.7.
 

jigsaw

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since there hasnt been much activity of this thread for a while I just wondered if anyone has been able to get confirmation from ulster bank in writing that they could keep the tracker and rent out their property without ulster bank "reserving the right to change this stance in the future"?
 

rustyjack

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nib/danske mortgage

hi brendan, all

i have a nib/danske tracker mortgage from 2005.
it does not say anything about ppr or moving to higher interest rate when renting so perhaps the summary of the key post could be modified as there may be others like me.

however it does state the following condition
"if you convey, transfer, assign, let or part possession with the property or any part of it without our prior consent in writing" as one of the conditions that they will make demand on the mortgage amount i.e. i will have to repay the full amount.

i understand this condition to mean a long lease as if it was a short lease, technically i would not be able to rent out a room in my house without their approval!!

am i right with this interpretation?

i intend to rent out the house for a few months while away on holidays and do not intend to notify danske/nib.

thanks,
rusty
 

Setanta12

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Haven't read through this thread entirely; but I have what I'm called a PPR-tracker from UB. I got an email from someone in their loan department to say I would not lose this tracker if I rented out my home and lived elsewhere.

(This, I believe is more than turning a blind eye)
 

Brendan Burgess

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i understand this condition to mean a long lease as if it was a short lease, technically i would not be able to rent out a room in my house without their approval!!
Where do you get that understanding from? What do you mean by a long lease?

"if you ...... let ... the property or any part of it"

If you let a property with a Danske mortgage, you are putting your tracker at risk.

If you let it for the summer and return to it, I doubt if the risk is worth worrying about. But if you were to buy another house and let your Danske mortgaged property, you would face a serious risk of moving to an investment property mortgage which is what this thread is all about.

Danske wants out of this market and they might well use a breach of contract like this to call for the mortgage to be repaid.
 

rustyjack

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thanks brendan for your response and advice.
I did some digging last nite and you are correct in that the mortgage is at risk if i enter into an official lease on the house even for a short period of time.
However, If i rent a room in the house, it is not a lease, it is a license. This is what i will do.
I will get the lodger to sign a license agreement which will stipulate that i may be away due to holidays for part of his time sharing the house with us.

thanks again,
rusty
 

STEINER

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For my PPR I have a PTSB ecb + 1.68 tracker mortgage from 1-11-2008 which I selected after the 2 year fixed period ended. I had a look at my original mortgage agreement which describes the mortgage as a Home Loan, its pretty basic, dates and figures etc. There is no mention whatsoever of renting out the property or having to inform them etc. Specifically, I don't have any separate agreement regarding the tracker mortgage, just a letter dated 1-11-2008 confirming my selection of the tracker option.

I have no immediate plans to relocate, but it may be an option in a year or two, and keeping the current property to rent.

Obviously I must ask PTSB directly about losing the tracker. Can they just produce a whole ream of terms and conditions that I have never received?
 

Cameo

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Based on this thread no-one seems to have experience of being forced off a tracker if they rented out a property contravening some original tandc's if their original contract.

I just don't see it happening at the moment. But please if there is anyone out there who has actually been found out could they share this?

Thanks

Cameo
 

duffer100

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I've been checking through my BOI loan offer (from 2008) and there doesn't seem to be any direct clause which relates to losing the tracker if I am not resident in the property. Has anyone seen a clause in their BOI loan offer that relates to this issue? Or is it an indirect or general clause?

On another issue, on the front page of teh loan offer the rate which is quoted is "Variable" but on the cover letter accompanying the loan offer it explicitly says that we are on the tracker rate and this is what we've been paying. Did this happen to anyone else and could this be a problem for us?
 

gdonal

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I've been checking through my BOI loan offer (from 2008) and there doesn't seem to be any direct clause which relates to losing the tracker if I am not resident in the property. Has anyone seen a clause in their BOI loan offer that relates to this issue? Or is it an indirect or general clause?

On another issue, on the front page of teh loan offer the rate which is quoted is "Variable" but on the cover letter accompanying the loan offer it explicitly says that we are on the tracker rate and this is what we've been paying. Did this happen to anyone else and could this be a problem for us?
Hi Duffer100,

Did you go any further into this - did you have any communication with BOI on this? I have a BOI mortgage from late 2007 and may be looking to rent out the house in the coming months, I have reviewed the contract and can't see anything about losing it or about renting the house. I am considering contacting them to get confirmation of this.

Cheers,

Donal
 

Kellus

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I have a tracker with BOI since 2006. I rang them to enquire if I'd be eligible for a new self build mortgage whilst holding on to my current home. I asked them what would happen to my tracker once I moved and he said I'd have to change it, the old house would be an investment property and I could switch my tracker plus 1% extra to the new mortgage for 5 years.
I've just looked at my contract and I don't see anything about renting it, judging from the replies on here, no one has had it taken off them for renting. I might take my chances and try and get the new mortgage with another bank, leaving my tracker where it is.
 

duffer100

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I have a tracker with BOI since 2006. I rang them to enquire if I'd be eligible for a new self build mortgage whilst holding on to my current home. I asked them what would happen to my tracker once I moved and he said I'd have to change it, the old house would be an investment property and I could switch my tracker plus 1% extra to the new mortgage for 5 years.
I've just looked at my contract and I don't see anything about renting it, judging from the replies on here, no one has had it taken off them for renting. I might take my chances and try and get the new mortgage with another bank, leaving my tracker where it is.
I never went ahead with renting out my original home but was wondering if gdonal or Kellus have any update on this? (Or anyone else for that matter.) Did the bank take any action in the end if you did?
 

csirl

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I've been renting out a a house with a BOI tracker for the past 5 years. Had to move house and become a reluctant landlord. BOI have known from the start and never had any issue with it. Contract, which I assume is the standard BOI one, is silent on the property being a PPR. Says it's a residential mortgage and a rented house is still residential. When I initially did it I expected them to try something and was prepared to get contractual, but was never an issue. Currently negotiating the transfer if the tracker to a potential new home (now in positive equity) and it hasn't been an issue there. They've told me my situation is quite common.
 
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