Question about fraud

Lots of people rent out mortgaged properties. You are indeed supposed to tell the lender and, in my experience, they say "ok". I doubt they' pay out

15k to find someone who doesn't tell them. Maybe you'd get some reward for reporting or stopping a fraud that caused a direct financial loss to a bank, like using a stolen card. The reward for recovering a stolen card used to be

2. > This question might be better posted to a crime type NG but it does involve

I very much doubt if Barclays would pay you anything. This sort of thing must be happening every second Thursday.

Rob Graham

Doing what you describe is not actually fraud, not in the strict sense, and therefore the police would not be interested. It is only a breach of contract (i.e. of the loan agreement), and as such a civil matter.

Indirectly it is fraudulent because it deprives the lender of the additional interest they would earn by charging the borrower a higher rate for permission to let. I imagine if Barclay's were invited by your informer to part with £15k for the tip-off, I suspect they would try to get out of it by confirming it wasn't really fraud.

What would the punishment be if they found out? One of two, I guess. Either they would immediately put you on the higher rate, possibly back-dated to when the renting started, or else, if miffed enough, they would terminate the agreement and invite you to pay back the whole loan immediately. If you couldn't they might sell the house from under your tenant, leaving you with whatever loss they make by selling dirt-cheap at an auction, and also leaving you open to be sued by your tenant for the cost of alternative accommodation plus solatium, minus the rent they would have paid you.

In message , Ronald Raygun writes

No judge in the land would grant possession on these grounds solely.

And Barclays wouldnt take such steps if they actually learned there was a tenant in occupation, because if they acknowledged there was a tenant then they acknowledge the existence of the tenancy and therefore must accept is has a term to run.

Therefore, Barclays are only going to take immediate steps to re-possess if the payments are missed and so long as they have no knowledge of the tenancy.

Not without a court order and it is unlikely that they would apply for anything other than vacant possession.

The benefit of a tenant will generally devalue the property and the cost and hassles of administering the tenancy is now what they are after. Although appointing a receiver to continue to tenancy would seem like good sense to you and me, the cost for a normal buy to let makes it unrealistic for the mortgagee.

BUT as already said, they wont repossess merely for sub letting.

In message , Ronald Raygun writes

Tort and equity are wonderful things.

Theyd be kicking it IN wouldnt they?

They cold but they wouldnt 'cos the the law wont support that view.

Not so, sadly for the lender.

LONG LIVE TENANTS RIGHTS!!!!!!!!!!!

The remedy will have to be proportionate. For example, missing one mortgage payment by 1 day is technically a breach, but you aren't going to be repossessed for that, you will only be liable for any extra costs the lender incurs writing you warning letters and suchlike. I think the interesting (sic) question would be whether the lender would be entitled to claim a BTL interest rate retrospectively. On the face of it they should be able to, but I suspect there would be so much whinging from the likes of You and Yours that they don't.

[snip]

He wouldn't be blocking it. He has a discretion to grant or not grant the order sought. He would opt for the latter.

(uk.legal added)