Buy to Let / Let to Buy Mortgages

Buy to Let

The key to making a buy-to-let venture work for you is finding the best possible mortgage deal. That’s why it’s so important to take impartial advice – especially in today’s market.

While buy-to-let mortgages are similar to residential home loans, there are some very important differences that our expert advisers can help you get to grips with.

For example, buy-to-let mortgages require a larger deposit than regular loans (typically 25%), and you’ll need to show the lender that the rent will cover your interest payments on the mortgage by at least 125% – in case the property stands empty for a while or needs maintenance.

On the bright side, buying a property to let out offers the appealing prospect of a potential rental income, plus the possibility of equity to unlock later if property values increase.

Let To Buy

How does let to buy work?

If you own enough of the equity in your property, you could remortgage and release some cash to put down a deposit on a new home. You would then let out your existing property and use the rental income to cover the cost of the mortgage. This in turn will free you up to take out a mortgage for a new home and cover the repayments with your salary or other sources of income.

Mortgages if you want to Let to buy

Although some lenders will allow you to let out your home on a residential mortgage, this will normally only be on a temporary basis. So unless you are only going to be letting it out for a short time, it is likely you will need a buy to let mortgage.

Buy to let mortgages are similar to residential loans, but there are some differences which our advisers will be happy to talk you through. Generally, buy to let mortgage rates tend to be a little more expensive than residential loans, and you will need to put down a larger deposit, at least 25%. Make sure you compare the best buy to let mortgage rates on the market.

Lenders will also want to see evidence that your rental income will comfortably cover your mortgage repayments. Speaking to letting agents and looking at local property listings should give you an idea of typical rents in your area. You can also use our mortgage repayment calculator to get an idea of your monthly mortgage payments may be.

 

Buy to Let mortgages are not regulated by the Financial Conduct Authority'