UK Landlord Forum / Life

Hi everyone,

I've been renting a property out to a family and one of their friends for the last 2 years. The council have just told me that I should have applied for an HMO licence for the property as it now fits under new HMO rules. The problem is, that I remortgaged the property as a single let mortgage, but this was before the new rules were put into place.

I'm in a bit of a catch 22 as The council are demanding I apply ASAP, the mortgage company I have would need to be notified and would apparently not allow me to switch from single let to HMO without first terminating the initial contract, which would lead to having to pay a huge early repayment charge! (£16k!) Plus then be on much higher interest! The tenancy contract is up so I was planning on serving them their notice ASAP, but apparently it isn't that easy according to the council man! I couldn't quite understand why!

If it is easy enough to evict the tenants, do you think the mortgage company will be lenient at all? If I say it was an honest mistake and wasn't aware changes had happened! Also technically the HMO application takes 3 months so I could potentially keep it quiet and just say I was planning on changing the house to an HMO after the tenants left, but then changed my mind! Just thinking of any way to avoid pay a huge bill!

Any thoughts greatly appreciated

Thanks

James

The council may have their own agenda,so I am not sure about the advice they gave you.I would serve 21 while you still can, tell the council et al that you are only going to have a single let from now,and hope that will be the end of it.If you have served notice I don't think the council will necessarily pursue it.

Either the property legally require a licence or doesn't. If the property requires a licence and doesn't have one or an application is not ongoing, then any s21 served during that time would not be valid.

These would be the new HMO rules that came into force on 1.10.2018, and the council's advice is likely to be correct.  Talk to your mortgage lender.  Explain that you set up a tenancy that was compliant with the rules, but the rules subsequently changed.  Tell them that you'd prefer not to have to evict your existing tenant and ask them to allow the arrangement to continue until this tenant chooses to move on.

If James started the procedure for licensing,could he serve 21 in the interim? I can't imagine the droids at my local council agreeing to anything that does not fit the rules or requires common sense.I have just paid a sum in council tax that I do not owe to prevent the machine serving me with a summons.The council has now got to refund that straight back to me.

Yes, if the application for a licence is ongoing, then s21 can be validly served. Alternatively, a landlord can apply/ask for a temproary exemption from licensing on the basis that they are going to take steps to make the property non-licensable, i.e. by giving notice and evicting after getting that exemption.