mnmmds Posted June 4, 2007 Report Share Posted June 4, 2007 Dear All, I got a flat last year on a residential mortgage from HSBC. Later my circumstances changed and now I have a tenant living there (I moved to my parents) but the mortgage remains residential. My buildings insurance is covered in my service charge for the apartment. My friends have told me that I might get in trouble with the insurance should for instance the place get burnt / destroyed as I do not have a buy to let mortgage. Is that true or will the insurance pay out irrespective of who is living in the property? Thanks for your assistance. Kind regards, Mike Link to comment Share on other sites More sharing options...
Simon Dewsberry Posted June 4, 2007 Report Share Posted June 4, 2007 In this particular situation you will probably be covered but you should request a copy of the insurance terms to verify Also as a seperate issue you should inform your mortgage company that you are now letting and not living in the flat - as you could technically be in breach of mortgage conditions. This unfortunately gives the M co an opportunity to possibly vharge you a fee for allowing you to "let" also they may charge you a higher interest rate. As you are leasehold (assumed as you have a service charge) you should check your lease conditions to ascertain whether or not you can sublet your flat - and is there a charge for doing so. It is for the above possible financial costs that a lot of people choose not to inform anyone and just let them any way . Great until there is a problem ! I would contact all of the relevent people and ask "what if I did let ......" as opposed to "i have already let ......................." and when you have all then info then take a view on it .......... Hope this helps! Simon Link to comment Share on other sites More sharing options...
J4L Posted June 5, 2007 Report Share Posted June 5, 2007 Yes I agree here, definitely check these things out because if things do go t**s up you could find yourself losing your investment. Link to comment Share on other sites More sharing options...
tony_ mort Posted June 5, 2007 Report Share Posted June 5, 2007 Confirm on your lease you can let. The management co could get difficult if you do it and are specifically barred from letting, or have to get the mgt. co's permission in writing prior to going ahead. As they hold the insurance they will normally need to know anyway. Regarding your mortgage - personally I wouldn't worry. You won't be able to take out another personal mortgage so infact their risk may even be reduced by your letting the flat. For completeness however, put a clause in the tenancy agreement that says: "This property is subject to a mortgage in favour of ..... It is irrevocably agreed between the parties that the tenant will, if so requested by ... or the landlord make rental payments (in part or in full), direct to ... in a manner duly specified at the time of any request." If your mortgage provider finds out at least he will know you were thinking of him. Link to comment Share on other sites More sharing options...
Chris Knight Posted June 5, 2007 Report Share Posted June 5, 2007 As the insurance Buildings insurance is run by the management company best to inform them. It may have no affect but better safe than sorry. You don't say if you have contents within the flat. If you do and they are insured, please do inform the insurance company immediately. If you do and they aren't insured (this included carpets, curtains, standalone white goods etc.) I would recommend that you get specialist Landlords Contents Insurance - see list of providers on this site. www.leaseguard.net Link to comment Share on other sites More sharing options...
mnmmds Posted June 5, 2007 Author Report Share Posted June 5, 2007 Dear All, Many thanks for the invaluable information. I did talk to the property management company and they said that I am fully within my rights to sub let the flat without infringing on my lease or buildings insurance conditions - it was a relief! Once again, all help much appreciated. Kind regards, Mike Link to comment Share on other sites More sharing options...
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