Renting?????

[Pinkypie]

Hey all,

Me and my husband live in a 3 bedroom house and we have wanted to move for some time into a bigger house. Unfortunately the housing market is still shaky and we know of someone who would love to rent out house. My questions are?

1) Is there something I have to do about my mortgage i.e. re-mortgage for lower rates as a rental etc...
2) It is accustom to rent fully furnished?
3) Would getting a second mortgage be difficult in this current climate? (diffucult to answer I realize)

I expect there are more questions but his is enough at the moment.

[Count-A-Strong]

1) not really sure what you mean. You would have to inform your mortgage company if you were renting out your property.
2) sometimes properties are furnished, sometimes they aren't.
3) depends what collateral you have on your first property.

[Twenty20]

Yes, you will need to tell your lender and there may be a charge or a higher interest rate. It's possible to go for an interest only mortgage but remember that you'll never pay off what you owe this way, only the interest.

You can let your property furnished or unfurnished, although unfurnished usually means leaving white goods in the kitchen. It's up to you to decide and what the tenant wants.

There's not a problem getting a second mortgage so long as your finances stack up. By this I mean that you're currently earning enough to get a suitable mortgage for the new property and you have a good credit rating but also that you can afford to pay two mortgages during the times when you have a void period (no tenant) in the house you let out (and you must allow for having void periods when there's no tenant). Can you afford to pay two mortgages while you look for new tenants?

There are also numerous other costs involved in letting your property out e.g. landlord's insurance, legal fees, agents fees (if you use an agent, and I would recommend that you do at least to start with if you've never let out a property previously).

If the person you have in mind as a tenant is a friend or relative I would be very careful. Have you considered the problems it will cause if your tenant fails to pay the rent or damages the property?

I wouldn't recommend anyone goes into letting out property in a half hearted, casual way. There are many pitfalls for the unwary landlord. Look on it as a business and it can work ok.