New mortgage application with existing rental property on tracker

[Patboy]

Hi,

About to apply for a self build mortgage and advise kindly needed.

My wife and I intend to start building a new home this spring on a site that we own and with full planning obtained.

We were both home owners before we got married 11 years ago.

Our current family home is mortgaged in my wife's name and has 15 years remaining on a 3 year fixed rate with BOI.

My property is currently rented to long term tenants (12 years), the mortgage has 18 years remaining and is on tracker rate with BOI (35 year mortgage).

Everything is declared with revenue and RTB but I never informed the bank that the property is let as this happened in the crash and things were extremely tight back then.

We intend to sell our family home after we complete the build and retain the rental property as an investment.

After research we would like to apply for a BOI self build mortgage but are very concerned if BOI will convert my tracker into a buy to let if we submit application.

Has anyone any experience with similar circumstances?

P.

 

[Sconeandjam]

Boi might already know you have rented the house out based on checking rtb lists. I know Ulster Bank did the same thing a few years ago. Check your orginal loan offer you signed and see if it states you will loose the tracker if you rent the property out. Often banks do not move you to btl but leave you as is as long as you are paying the mortgage. That happened to us but we were not looking for a new mortgage.

Apply to other institutions instead of boi for a mortgage to self build but first do your workings to see if they will give you the mortgage based on stress tests. You may be over stretched based on your own calculations.

 

[Patboy]

stress

Hi Sconeandjam,
Thanks for your insight.
I’m fairly confident that we can meet all stress tests, the values involved aren’t huge.
It’s just that we wouldn’t like loose the tracker, but if we did I’m still fairly sure we manage even with stress testing with a BTL rate.
I was just wondering if they would defo take the tracker rate away.
In the bad old days I felt it was like see no evil, hear no evil with the banks as long as the mortgage was paid.