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Buy to Let Mortgage
During the last few years many professional landlords will have been able to build up solid portfolios of property. Often you will have this wrapped up with one tidy business or commercial loan (or mortgage). These portfolio loans often with mixed property types ranging from several flats on one title and shops mixed with flats and other asset types. Our experts can work with you to decide the best approach ranging from splitting your loan and mortgage finance into smaller amounts and/or refinancing with one lender to raise more funds to continue your growth (or reduce your costs). Even if you only have one property you might find high street lenders unwilling to assist because your circumstances have changed or you can’t secure the higher loan to value buy to let mortgage that you desire. That’s where our consultants can help with access to all the deals on and off the high street.
Our Full Service Approach To Your Portfolio Includes
- Access to all the different lenders – both high street and broker only.
- Every portfolio size – from one property to large mixed portfolios.
- A wide range of property types including Commercial Property Mortgages and HMO Buy to Let Mortgage
- All types of applicants from individuals and partnerships to Limited Company Mortgages
- Fast no obligation service will let you see where we can raise you more cash or save you money on your portfolio of property, even if you’re looking for No Income Verification!.
- We also can help you with Development Finance!
Just complete this short form to the left and we will analyse your requirements and you will be contacted by a specialist who understands your type of property or portfolio within 48 hours (usually sooner) to provide a NO OBLIGATION quotation. There’s nothing to lose and great deals available so find out more now.
Buy to Let Mortgage Rates
Buy to Let (or BTL) rates vary from time to time and are subject to change. Before securing a property, it is always advised to make sure you are getting the best rate on your buy to let mortgage. Remember, you could be putting a couple hundred extra pounds into your pocket each month by obtaining a lower rate! BTL Mortgage rates as of now:
|Maximum LTV||Initial Rate||Subsequent Rate||Overall Cost|
|60%||1.44% until 2022||5.99% Variable||5.1% APRC|
|70%||1.59% until 2022||5.99% Variable||5.2% APRC|
|60%||1.64% until 2022||5.99% Variable||5.1% APRC|
Buy to Let Mortgage Income Requirements
Most lenders will base your BTL mortgage off of how much you are expecting to receive in rental payments. Typically, a lender will expect that you will receive at least 125% of the loan payment in rental payments each month to consider it a safe investment. This is in contrary to a standard mortgage, where lenders will be booking at your your salary and other sources of income, as well as your down payment, to judge whether or not you will be able to repay the mortgage. As a landlord, it is important that you carefully consider all options and you run your property efficiently such that cash flow is always in the positive. Always consider options when looking to borrow funds for your buy to let property, as payments may put your existing properties at risk. Additionally, choosing the proper term for your buy to let mortgage may reduce your payment in some cases – as well as making sure all of your financial ducks are in a row.
Buy to Let Mortgages Explained
Sometimes, buy to let is rephrased as BTL, or even buy to rent. In all cases, it means the same thing: the property is being purchased for the sole intent of renting it out to other tenants to collect rental income and a buy to let mortgage is a helpful tool in achieving your landlord dreams. Keep in mind that rental properties require different types of insurance than your personal home, and you should always consult with a licensed insurance broker to ensure that you are fully covered for any type of incident.
Buy to Let Mortgages generally are offered on a 2-year fixed term, becoming variable after the original fixed term. Quite often, better credit scores and higher down payments can help you to lock in your mortgage at a lower rate, so it is highly recommended that you have your financials in order before applying for a buy to let mortgage.
How Much Can I Borrow for a Buy to Let Mortgage?
The amount you can borrow for your latest investment property can vary. As outlined above, most lenders will want to see that you will be able to have 125% of your mortgage payment in rental income. This helps provide a safe way for lenders to somewhat guarantee they will be repaid. If you’re buying your first buy to let property, we strongly recommend talking to one of our professional advisors beforehand so that all of the options are outlined for you in a clear and easy to understand manner.
What Type of Credit Do I Need for a Buy to Let Mortgage?
Most lenders will expect that you have great credit to be considered for a BTL mortgage. This is because, most likely, you will already have an existing mortgage payment and it can become quite easy to become overextended financially. They will also want to check that you are making all of your existing debt payments on time to help prove your credit worthiness.
What Types of Fees are Associated with a Buy to Let Mortgage in England?
On average, most buy to let mortgages will have an associated 1.5-2% with the note itself. Keep in mind that you will need a higher deposit, or down payment, in comparison with a traditional mortgage. As noted above, this is because you will likely already have an existing mortgage on your personal home, and institutions that are lending money will want to ensure that you are not over extended. The man risk in this type of lending is that your tenants may stop paying rent, for whatever reason, leaving you strapped for cash and unable to repay the mortgage on your rental property. Remember, your monthly buy to let mortgage payment will should be less than your total rental income – there will be property maintenance on the rental home as well as any unforeseen expenses.
What is a Buy to Let Mortgage?
Buy to Let Mortgages are defined as the specific purpose to buy a property with the intent to let-out, or rent the home, to tenants other than the property owner. While these terms usually are for homes, they may extend to student housing or even hotel rooms as well. Up until the 1980s, these types of mortgages were few and far between. In the old days, letting property was often reserved for wealthy investors who could afford to buy a home without a mortgage, or those professional property investors who could qualify for a traditional commercial loan, which is far more stringent than a BTL mortgage.
As property prices have increased over the years, buy to let mortgages have become more popular as investors look to cover their mortgage payment via the rental income, and put additional cash in their pocket as well. On top of that, property almost always increases in value over time, meaning that when its time to sell the home investors are often looking at a nice cash out as well.
Are Buy To Let Mortgages a Good Investment?
It has been long known that buy to let has been a great investment alternative for many professional and novice landlords. What many people seem to forget is that there are many other costs associated with being a landlord other than making the mortgage payment; insurance must be maintained, maintenance must be done on the property, repairs need to be completed promptly and taxes must also be paid on time. Most importantly, keep in mind that even the best tenants may miss a rent payment or pay late, putting you at risk of your own buy to let mortgage payment!
There are a few reasons that a buy to let mortgage may be a great investment option for individuals wishing to enter the landlord scene:
- Property values tend to increase over time, and landlords can use the potential of increased property value over time to help net a lump sum later on
- The National Association of Estate Agents claims that there are currently 10 buyers per 1 available house on the market – meaning that buy to let mortgages may be a safe investment as more and more people turn to renting in a housing shortfall
- In 2015 it was estimated that landlords had profited over 177 billion pounds just from property value increases
Is Buy-to-Let Insurance Expensive?
The amount you pay for your buy to let insurance can vary greatly depending on the type of property and your own personal financial situation. You may pay anywhere from 100 pounds to over 1,000 pounds per year depending on the numerous factors we’ve discussed. Additionally, some insurance providers may give you a no claim bonus if you do not make any insurance claims within a certain time period.