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  • Mortgages & Finance

    R2R SA on BTL mortgage - is this legitimate?

    Hi,

    The question I have is really bugging me as I can’t find the answer anywhere.

    I have approached a landlord who is using a buy to let mortgage on their property. I intend to provide a R2SA service on the property - but what would the landlord have to say to their mortgage provider about the change of use?
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    Hi Adam,

    If they disclosed the change of use to the lender, the lender would almost certainly refuse to allow it.

    You cannot undertake this activity on a property with a BTL mortgage on it.  It would be a breach of the terms and conditions.  Furthermore the BTL mortgage was issued on the landlord's personal financial situation and single occupancy long term rental, so its a no go from the start.

    This thread will provide further insights:

    Serviced Accommodation / Airbnb - legally?

    We also have this video on whether you will be creating a hotel and what that means:

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    Thanks - does this essential mean R2SA only really works with landlords who don’t have a mortgage?
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    I would go further than that.  I would say it only legitimately works on unencumbered* freehold houses .... 

    There are some specialist mortgage products for SA appearing on the market, but they are few and far between, and I believe they are at higher rates. 

    *property with no mortgage secured against it.

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    Agree - add to that if its a London property then you have the mayors 90 day rule that applies too.

    People are making good money out of R2SA at the moment, however I wonder how many of them are actually doing it legally.....

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