Renting Mortgaged Property

I have a mortgaged property on a straight forward mortgage not Buy to Let.  With redunancy looming,  and with the resale market only obtaining half the price of what I paid I really need to cover my outgoings each month by either holiday letting or a temporary 11month contract each year.  Is this an option that is usually allowed with a mortgaged property?  Do Ineed to obtain a Licence before I advertise it for rent.  I have searched for some information but there are so many pages on other renting issues that it is difficult to find anything quickly and I really need to get in touch with a renting agent for this season.  Also I believe Ihave to pay taxes on the rental income.  What are the rules here please?

Which part of the coast is your property ? I believe on the Costa Blanca properties have to be registered with the authorities. here on the Costa Del Sol, no one seems to bother. Holiday lets very hard this year, 11 month long term better.

Hi Hamtine,

Legally I believe you will be in breach of  your mortgage if you do this (I know many people do rent their property out) as lenders stipulate that the property is for residential / personal use and will not allow the property to be used for investment purposes. Some lenders will allow rental to family and friends, on a short term basis e.g. for holidays. Buy to Let is uncommon in Spain and in fact I know of only one lender who does offer a Buy to Let mortgage here and this is based on 50% of historical, provable income.           As far as I aware the tax rate is 24% of gross income and deductions are not allowed for expenses.

Hope above helps,

This message was last edited by sharonw on 14/05/2009.