From: Ronald Raygun 
Subject: Re: Permission to let conundrum
Newsgroups: uk.finance
Date: Tue, 15 Aug 2006 17:32:20 GMT

swerious wrote:

> Ronald Raygun wrote:
> 
>> They are unlikely to have teams of detectives
>> looking around trying to see if borrowers really are living "at home".
> 
> Thought so!
> 
>> But if you do happen to miss a payment, perhaps due to a cash flow
>> problem 
> 
> Understood. I guess a good way of heading off this potential situation
> would be to always keep 3 months worth of mortgage payments in a
> savings account or similar to cover for such eventualities.

3 months?  May I suggest you ask your optician to "hold the rose tint"
on your next pair of spectacles?

>> Not sure why you think it would be.  It's not as if you were extending
>> the term.
> 
> OK, I had assumed since it would be effectively a new mortgage they
> would be lending on a flat with a shortish lease.

They would, but I thought the relevant figure would be the number
of years left by the time the mortgage term ends.  Worst case is they
need to repossess during the last few years, and if the lease is short
*then*, the property will be more difficult/costly to sell (or would
realise a smaller value at auction).

>> How do you know it's an alternative at all?  
> 
> Thanks but believe me I've thought about all this and we can get
> tenants OK and renting is the best solution in the medium-term.

Fair enough.