Buy to let mortgage lenders will usually insist
that you have a deposit of 15 per cent, so the size of your
deposit will help determine the amount you can borrow. Lenders
will usually insist that the rent the property will command
covers 125 per cent of your mortgage payments (although some
will accept 100%).
This protects both you and the lender against rental voids -
periods when the property is un-tenanted.
Unlike residential borrowers, most buy to let investors opt for
interest-only mortgages, simply paying off the interest owed to
the lender, but not the outstanding capital. This is repaid on
the sale of the property.
At Mortgage Alternatives we can help you find the best deal for
you, whether you have a large portfolio of rental properties,
or, if this is the first time you have considered buying a
second property to rent out.
With a buy-to-let mortgage some lenders will only consider your
rental income when offering a mortgage, while others will place
more emphasis on your normal earnings.
Your expected rental income will normally need to exceed your
mortgage repayments by a certain percentage. For example, the
mortgage lender may require a rental income of 125% of your
monthly mortgage interest payments. The lender will also want to
establish whether the property you are buying is a good
long-term investment. So, buy-to-let mortgages are subject to
the usual status checks. Generally buy-to-let mortgages are
available for between 5 and 40years and for up to 85% of the
property value.
When considering a buy-to-let it is also necessary to bear in
mind any additional costs such as letting agent's commission, if
you are using one, protection premiums for building and contents
cover; rental and legal expenses cover, the costs of keeping the
property in a suitable condition for letting, and if applicable
the service charges and ground rents if the property is
leasehold.
So please complete our enquiry form and one of our Mortgage
Advisers will contact you usually within minutes to offer you
comprehensive advice whether you are considering your first
buy-to-let purchase or indeed if you have an established
portfolio of properties and are looking for a more competitive
deal.
They will even take care of all the mortgage paperwork for you,
so you don't need to worry about a thing.
If you wish to speak to an adviser immediately simply phone 0845
833 7500.
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To obtain whole of market advice from a qualified adviser (who
will act for you and not the lender) simply complete the short
online enquiry form and press PROCEED.
To help the process please enter as much
information as possible.
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| Also known as a Capital & Interest Mortgages, because an
element of capital is being repaid each month, as well
as any interest. This brings the peace of mind of
knowing that you are reducing your debt every month.
This type of mortgage guarantees that the loan is repaid
at the end of the mortgage term, provided that no
payments have been missed. |
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| With this type of mortgage only interest is paid to the
lender therefore the amount owed on the mortgage remains
the same. Interest-only mortgages usually have lower
monthly payments than a repayment mortgage but are
inherently more risky. |
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Part Interest Only/Part Repayment Mortgages |
| With a part interest only/part repayment mortgage, a
proportion of the loan is treated as an interest only
mortgage and the other proportion as a repayment
mortgage. Therefore, you will use both repayment and
interest-only methods to repay the loan. |
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