If I rent out my own house will I definitely lose tracker?

RichieRich

Registered User
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31
On a tracker but need to move (work reasons). I understand I need to register with the prtb, pay the nppr fee and inform revenue that I would no longer be eligible for tax relief on my mortgage.

Is it a "given" that I will lose my tracker rate in the process or would the bank definitely be informed?
 

Dinny

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257
Bank will only be informed if you inform them. By doing registering with PRTB paying nppr canceling your TRS etc, they will not tell the bank you are renting the property
 

RichieRich

Registered User
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31
Thanks Dinny, well that seems like good news then! If I change the insurance to cover the tenants, could that be a flag to the bank?
 

Bob Nellies

Registered User
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32
It was a legal condition of my mortgage contract that i recieve permission from the bank rent out the house.

So i asked them - recently.

Bank had no problem and my tracker mortgage T&C remained the same.

Now i am not worried/stressed about it or trying to cover my tracks..
 

Knuttell

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704
So i asked them - recently.
Did you get that in writing from them?

I personally would sooner take the word of a junkie than that of a bank official,I have learned that if it aint in writing its not worth the paper its not written on.
 
D

Dermot3

Guest
If I move house will i lose my tracker

My understanding from recent discussions with my bank is that you will only loose the benefit of the tracker if there is a change on which the property is secured and you are in effect taking out a new loan. To rent out what was your former residence should not be a problem or indeed if you try and move to paying interest only for a specified period this should not mean loosing the benefit of tracker. However if you tried to swap houses for example your old mortgage that you wish to switch to the new property is deemed a new mortgage and all new regulations will apply including loss of tracker. It is only a new/change in address that can result in you having to go on a variable rate.
I did try and negotiate with bank - I am swapping a house but bank tell me I have to go from 2.2% to 4.4% undermining the viability of the whole deal. When I pointed out to bank that if we could agree a rate of say 3.5% everyone would be happy - both homeowners get property they want, bank get me off a 2.2% tracker and government get benefit of a stamp duty payment from both parties. Seemingly we ae going from a regime of lax regulations to very stringent and sometimes idiotic regulations.
 

RichieRich

Registered User
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31
Without having to phone my bank, where can I check the T+C's of my mortgage in relation to the loss (or not) of the tracker rate, if I rent out my place? Would my solicitor know? Also, when it comes to informing Revenue that I am no longer entitled to relief on the mortgage, should this be done in writing and how should it be worded??!
Thanks in advance!
 

twofor1

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1,265
I don’t think anyone here can give you a definitive answer, it appears from other posts that some T&c’s mention what happens in this case, others don’t, some in similar circumstances never told their bank and still have their trackers.

Do you not have a copy of your T&c’s, if not ask your bank for a copy, you don’t have to say why you want them. This is where I would start.

I don’t think your solicitor would have this, but you could ask.

If you say which bank it is someone might be able to tell you how they got on in a similar situation with that bank.
 

twofor1

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1,265
If I change the insurance to cover the tenants, could that be a flag to the bank?


The banks interest is usually noted on house insurance policies. Would the insurance company not be obliged to notify the bank of the change from PPR to rental property ?

Your bank administers TRS on behalf of revenue, when you notify revenue this mortgage no longer relates to your PPR, revenue will have to notify your bank to stop applying TRS to this mortgage. Another definite flag I would think.
 

murphaph

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1,136
The banks interest is usually noted on house insurance policies. Would the insurance company not be obliged to notify the bank of the change from PPR to rental property ?

Your bank administers TRS on behalf of revenue, when you notify revenue this mortgage no longer relates to your PPR, revenue will have to notify your bank to stop applying TRS to this mortgage. Another definite flag I would think.
I have hit a few flags with my lender including the above. So far so good, still haven't been contacted by them about it. Will cross that bridge when it comes (if it comes). I have even requested "certificates of interest" in September/October, shich should be a red flag if ever there was one. I think a lot of banks will be quietly happy that the mortgage is being paid at all, given the number of people heading towards default.
 

rosemartin

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123
all the bank are intrested in at present is your money, contact your insurers and let them know of change of status. no one from prtb, revenue or councils will be contacting your bank. keep the monthly payments up have it insured for tenants and you will be fine
 

twofor1

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1,265
all the bank are intrested in at present is your money, contact your insurers and let them know of change of status. no one from prtb, revenue or councils will be contacting your bank. keep the monthly payments up have it insured for tenants and you will be fine
If you are claiming TRS, revenue have to contact your bank, while they might not specifically tell them you are renting your property, they will tell them you are no longer entitled to TRS on this mortgage. A definite flag.

I accept your point that at the moment the bank might be happy that the repayments are being made but there is no guarantee that they will always be this agreeable.

If T&c’s say the property must remain your PPR to avail of the tracker rate (not all do) and you don’t inform them of the change, bearing in mind they probably know through the TRS and insurance issues that you rented, would they not be entitled to switch you to their investment rate when it suits them ? Next year, the year after or maybe in 5/10 years time.

Would they also be entitled to apply the higher investment rate retrospectively ?

I would only be happy if I got conformation in writing acknowledging the change to rental property at the existing tracker rate.
 

murphaph

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1,136
The bank could ask for you to pay back the extra interest in retrospect but they couldn't just take it. They would have to take you to court for it and prove that you broke the T&Cs and get a judgement against you for it. The chances of the bank being able to prove that you were renting the house out are actually quite low. You can have any number of excuses lined up and it basically comes down to your word against the bank's. They have no access to Revenue data nor would it ever be supplied to them and if it was it could likely not be used against you in a court action.

This is all seriously hypothetical stuff. The most the banks will do is take immediate action and try to force people (strongarm tactics) off their trackers. There will be no retrospective levying of interest.
 

RichieRich

Registered User
Messages
31
Here's the latest update! As someone suggested, I never mentioned which bank I'm with, which would obviously help people to give me advice - my mortgage is with PTSB. I rooted out my original letter of approval over the weekend and read through the Terms/conditions - there is no specific mention of Owner occupied, Principal residence, or renting out or any other terms relating to renting it out. Can I assume this means I'm clear to rent it out or does it even give more hope to me renting it out, taking the chance and not losing the tracker?

Thanks again in advance
 

twofor1

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1,265
No clear reference to the property having to remain your PPR to retain your tracker is encouraging. I don’t think you can assume anything until you have something in writing.

I can’t see what you have to loose by writing to your bank, telling them you are considering letting the property for work reasons. Having read the T&c’s your understanding is you would retain your tracker in this event, would they please confirm this.

If they reply and say yes, great you know exactly where you stand.

If they say no, they will say why. You are then in a more informed position than you are today, you can accept it or dispute this with them now or,

You can still choose to just do it and not tell them and If/when they change your tracker to their investment rate and if you think you have a case you can then complain and take a case to the Ombudsman if necessary.

 

philcsl

Registered User
Messages
18
I had the same with PTSB, initially they said I would lose the tracker but as the clause was not in the loan agreement they then agreed I would keep the tracker and sent confirmation in writing so you should be fine to keep it, you might have to argue the point with them for a few minutes and ask them to read the conditions on your loan agreement.
 
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davidd

Guest
philcsl what was the wording in your loan agreement. I am also thinking of renting out my property and the only wording I can see is "1.4 The property, unless otherwise agreed, be used for owner occupation only." but it dosent mention PPR or to contact them if things change. What did yours say?
 

serotoninsid

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1,760
"1.4 The property, unless otherwise agreed, be used for owner occupation only." but it dosent mention PPR or to contact them if things change. What did yours say?
Owner occupation = PPR.....or at best, ownership without anyone elses occupation i.e. not renting it out.
 
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