Letting your property can be a minefield, especially for first time landlords. After you have prepared your property with redecoration and repairs, found your tenant and made sure they can pay the rent, complied with all your legal obligations including gas and electrical safety, and fire labels, it is easy to forget you might need permission to let your property.

If you have a leasehold property you will probably need the permisson of the freeholder to let your property, which will be known as sub-letting. The details of this will be contained within your title deeds. Some freeholders will be entitled to object to the tenant you have selected, others simply need to be notified. In virtually all cases there will be an administration fee. You should contact the managing agent to tell them of your intentions. They are only entitled to the information and the fee as stated in your lease. If you do not notify the freeholder, it is likely you will be in breach, and liable for Court action. As a worst-case scenario, it is possible for your freeholder to apply for your lease to be forfeited.

Even if your property is freehold, if you have a mortgage, you will need to contact your lender to advise them of your proposed letting. In most cases you will need to get their formal written consent. This may involve a change in the terms and conditions of your mortgage, and possibly a change in interest rate. There may also be a requirement for you to serve notices under the Housing Act 1988 on your tenant prior to the commencement of the tenancy. Should you fail to notify your lender, this will almost always be a breach of your mortgage terms, and the lender can call in the loan immediately, or take steps to repossess your property.

There are very serious consequences to failing to take these steps, so you should be sure of your obligations. If in doubt, we would be happy to review the appropriate documents and advise on what steps you should take. Also, if the freeholder or managing agent is asking for onerous information or a greater fee than your lease suggests, we have experience in negotiating these points.

After all that, don’t forget to consider your tax liability and your obligations to notify HMRC of any changes in your circumstances.

If you have any further queries, please do not hesitate to contact Frances Redding on 0118 9756622.

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