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Ernest Said:

Retention when re-mortgage?

We Answered:

Retention is only usual when there is necessary work to be done on a property eg damp proof course, roofing repair etc. before funds are released, sometimes other requirements may need to be met eg. paying off car loans etc. So no there shouldn't be, but obviously it depends on your circumstances and lender, if there is equity in the property for example.

Roberta Said:

What can I do about mortgage lender that falsified documents?

We Answered:

Why are you worried about it 3 years later?

Since you didn't borrow the money you were not harmed and you would not have any grounds for a law suit.

Depending on the state, since you waited so long there is good chance that the statue of limitations has run out. There is also a very high probably that the company is no longer in business. Complaints against realtors and lenders heard by a National Realtor Association or State Realtor Association must filed within 90 days after the discovery.

Tom Said:

Is it possible to rent a property if it is bought with residencial mortgage?

We Answered:

Once you decide to let the property, you will need to ask the lender for permission to let. Some may charge for such permission, some may even insist on you transferring onto a buy-to-let mortgage. The reason for this is because the risk is higher on BTL than on residential mortgages.

Failure to notify the lender will (if your insurance is through them) invalidate your insurance and could ultimately result in re-possession due to your breach of contract.

If your insurance is NOT through them, you will need to provide them with up-to-date insurance policies each year. It is no point you buying standard 'buildings' cover, because that would not be valid and be worthless, so they are going to see that you have purchased 'landlord insurance'.

Your second scenario is similar. The property that is being let would b mortgaged on a buy to let mortgage. The lenders decision on this would be based on the borrowers financial situation and the financial security of the rental property - is there a proven rental income history?

The other mortgage will be a residential one, but the lenders decision will take into account any other borrowing (eg BTL) that the purchaser has.

Ultimately, the banks will need proof that you can afford your plans for both properties. "I will rent it" isn't proof, because you may not be able to find tenants quickly enough and you may have rent-free periods between tenants.