Buy to let / Let to BuyMortgage & Protection Advice
What is a Buy to Let Mortgage?
A buy to let mortgage is typically for investment properties which are being let out to non-family members and in general require a larger deposit, have higher interest rates and arrangement fees and the amount you can borrow is usually based on the rental income you will be able to achieve in the prevailing market conditions at that time.
Buy to let generally should be seen as a long term investment and whilst some people see their property portfolios as potential for a future pension, others look to simply supplement their existing earnings. There are also those who find themselves unable to sell their property and see no alternative other than to lease their existing property out in order to purchase a new home.
How much deposit do I need for a buy to let mortgage?
It is possible to obtain a buy to let mortgage with as little as a 15% deposit. However, due to the recent changes this isn’t as simple as it first appears.
The amount a mortgage lender is prepared to lend is typically calculated on the rental amount the property could obtain in the prevailing market conditions at that time. Currently, whilst all lenders criteria differs, a required rental income could be calculated based on 145% of 5.5%, meaning for example that for a £150,000 loan the required incoming rent would need to equate to £997pcm.
So as you can see, if the purchase price was £176,000 and the rental income was for example £850pcm a 15% deposit at £26,400 would not be sufficient and an increased 32% deposit is needed.
Can I purchase a buy to let property via a limited company?
Again the answer is yes
At Top Mortgage Solutions we have access to a broad range of buy to let products provided by large high street banks as well as smaller banks and building societies and specialist lenders therefore recommend making us your fist call for Buy to Let Mortgage advice.