Will bank know we're renting?

J

josip

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We have a very good tracker rate on our existing mortgage with NIB for our apartment. TRS expires at the end of this year. We are considering buying a house next year and renting out the apartment.
If we take out the mortgage on the new house with another lender, and rent out our current apartment, is there any way that NIB will find out that we have sublet? I can't think of any way myself whereby they would receive a notification; PRTB?, credit record check?, etc, but perhaps I have the rose-tinted glasses on.
Has anyone done the same and subsequently been contacted by their original lender? Is there anyone in the banking industry who knows what the situation is?
 
Just to clarify - you have mortgage with NIB & want to rent out the property but you don't want them to find out? Because you'll lose your tracker rate?

Always better to be up-front about this stuff. If you won't be honest with your bank, how can you expect them to be honest with you?
 
as long as your mortgage is being paid, theres no reason for NIB to question anything but may be a different story when you approach a bank for a new mortgage on a new property and having the existing property as they'll go through to make sure both are affordable. would say your best bet is to approach a reputable brokers and see what options are available to you
 
Your understanding is correct MH and ethically, morally and legally your advice is also correct. Having been on the receiving end of a few banking errors in the past however, I no longer expect any bank to be honest with me.

I wouldn't defraud a bank out of any money, but at the moment they have a lot more serious issues to deal with and I probably won't hassle them with such a minor adminstrative detail without first getting a broker's advice on this as Tabris suggests. Thank you both for the replies.
 
what about how will your new lender view your existing mortgage?

They'll probably view you as a greater risk and may reflect this in the rate they offer you
 
finty said:
what about how will your new lender view your existing mortgage?

They'll probably view you as a greater risk and may reflect this in the rate they offer you
Click to expand...

Quite possibly, although from many of the posts here I think lenders, especially AIB, currently view anyone with a heartbeat as a risk. We originally had a 50% LTV on our existing mortgage and still have a 60% LTV thanks to some serious overpayment, so hopefully not all institutions will look unfavourably on this.
 
You do not have to inform your bank if you have changed from a residential to investment property unless it is a term and condition of your mortgage, I think it's more common now to be in your contract. It is probably easier for you to get a mortgage from your current lender than a new lender.

You are making a mistake in overpaying your current property if you intend to let it out. It would be better to have a larger mortgage on an investment property from a tax point of view than on a residential property, therefore you should be saving the overpayments to reduce your residential mortgage..

Make sure you inform your house insurance that the it is no longer a residential property and sign up with the PRTB - and renting is not for the faint hearted.
 
Ive being doing it with a property for the last 5 years. Nobody gives a sh1t. I pay my bills and revenue are paid up, everyone's happy.

OP, rent away and keep your bills paid and your mouth shut. Too much red tape bullsh1t in Ireland for the little guys. Always remember nice guys(or gals) finish last.
 
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