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NatWest tells BTLer to evict tenant on benefits or pay fine

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From the article:

Helena McAleer was reduced to tears after NatWest said she had breached her mortgage terms by letting her two-bedroom property in Belfast to a tenant in receipt of support from the state.

The 35-year-old was given the stark ultimatum of making her tenant homeless or footing a £2,500 bill to leave the NatWest deal, after asking for a further advance from the lender.

The tenant is an older woman, who suffers from mental health problems and would likely struggle with the moving process, according to McAleer.

She told Mortgage Solutions: “I was angry at the fact that another human being could ask me to kick out another human being.

“It was very black and white…  they don’t think about that person, you’re just an anonymised piece of data… that’s what hurt me, that’s not fair.”

She added: “[The tenant] is a vulnerable older lady, she has mental health issues; I’m not putting her out on the street.”

 

It's noteworthy because most landlords don't appear to have a conscience, at least not on this level.

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A spokeswoman for the lender said: “The bank has specific lending criteria and is not able to offer mortgages in certain circumstances, including where the applicant or broker has advised they want to let the accommodation to Department of Social Security tenants.

Does someone want to tell this state backed bank that the “Department of Social Security” has not existed since 2001 :D 

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4 minutes ago, elephant said:

 

 

Does someone want to tell this state backed bank that the “Department of Social Security” has not existed since 2001 :D 

Brilliant!

I still see ads for rentals that say "No DHSS".    And that hasn't existed since 1988! 

Somehow "DWP" has never really caught on as a pejorative term.

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I see ads for rentals that say "no pets no DSS no smokers no pictures no blacks no racists no single parents no working couples transsexuals welcomed"

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7 hours ago, EnglishinWales said:
From the article:

Helena McAleer was reduced to tears after NatWest said she had breached her mortgage terms by letting her two-bedroom property in Belfast to a tenant in receipt of support from the state.

 

Letting to anyone regardless of their status would have breached the mortgage terms.

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Is this Helena - from Belfast, now working in London. According to her CV first proper job was in 2004 which would have been at the age of 21 given she's 35 now from the article. Makes sense.

https://uk.linkedin.com/in/helenamcaleer

"I am Irish but based in London, I believe in ideas, creativity, yoga and meditation. "

". I believe in the importance of understanding the customer journey"

i personally suspect she has never given two ####s about her tenant.

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2 minutes ago, thewig said:

IS this article just a paid advertisement attempting to humanise DEBTjunkie scumbags?

Yup

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1 minute ago, elephant said:

The other poster says they would have breached have terms regardless of tenants status.  I took that to mean even if they were not on benefits.  Hence my question, why?

Maybe we have crossed wires.

I'm just saying that the landlord has an effective obligation to check the tenant's status, to make sure he/she isn't breaching mortgage TS&C's. So yeah in ignoring this issue they may get away with it accidentally. But the mortgage rules would appear to imply that the landlord should check.

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Just now, Captain Kirk said:

I don't have a problem with that. People who can't support themselves should not be in private rented accommodation paid by the taxpayer.

Indeed. I love the bit about lobbying govt to pay benefits directly to the LL

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2 minutes ago, Si1 said:

Maybe we have crossed wires.

I'm just saying that the landlord has an effective obligation to check the tenant's status, to make sure he/she isn't breaching mortgage TS&C's. So yeah in ignoring this issue they may get away with it accidentally. But the mortgage rules would appear to imply that the landlord should check.

Yep defo crosses wires!  

The other poster is implying (I think) that the lady was in breach of her mortgage terms for letting her property at all.  I.e. does the other poster think the lady in the article took a residential mortgage and shouldn’t have been letting to anyone?

Probably easier to wait for @Lord D'arcy Pew to answer my initial “why”.

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5 minutes ago, elephant said:

Yep defo crosses wires!  

The other poster is implying (I think) that the lady was in breach of her mortgage terms for letting her property at all.  I.e. does the other poster think the lady in the article took a residential mortgage and shouldn’t have been letting to anyone?

 

Eazy blaad 

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The Nat West BTL Mortgage has the following lending criteria - http://www.intermediary.natwest.com/intermediary-solutions/lending-criteria.html then follow the link for BTL.

The terms include the following.

  • We will not consider multiple tenancies, Homes of Multiple Occupancy, bedsits, DSS tenants or 'Related Person' tenancies.
  • A minimum income of £25k pa is required (for joint applications at least one applicant must earn £25k).
  • Maximum LTV is 75% (for new build flats or houses a maximum LTV of 65% applies).

Interest Coverage Ratio (ICR): The ratio of the expected monthly rental income from the Buy to Let property to the monthly mortgage interest payment which takes into account likely future interest rate increases. The minimum ICR threshold is 135%.  We will top-slice if there is a rental shortfall, taking into account any free personal income the applicant may have. In all cases, expected rent must continue to meet a minimum rental cover calculation of 5.5% x 125%. 

The ICR is very important, i sincerely hope that the bank continues to be as aggressive in enforcing their terms as house prices continue to fall...it'll be a bloodbath for small landlords if/when there is a crash. no idea what 'top-slice' means... but it doesn't sound good.

Anecdotal - i used to work for RBS (Who own Natwest). about a year after the GFC i was speaking to a senior manager in Finance and he told me that it was unbelievable how many companies RBS had taken ownership of. If a company breached its covenants RBS would call in their loan and take ownership of the company, they would leave the managment/owners in their job but now RBS owned everything. He reckoned there were 100's if not 1000's of companies that RBS had done this to. It's probably a large part of the GRG scandal thats been in the press recently, though nothing i've read has sounded quite the same as the structure that this manager discussed with me, which made it soud like RBS was sitting on a load of 'zombie' companies it would eventually sell for a profit, as opposed to aggressively close down.. 

According to their induction course for new staff, just before the GFC RBS was the largest single owner of hotels and bars in the UK. If they wholesale foreclose on their BTL book they might end up the largest single owner of residential property in the UK.

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