How do I apply for a buy to let mortgage?
What
is a buy to let mortgage?
A
buy to let mortgage is a mortgage on a property which is to be let out or rented,
rather than occupied by the owner ie: a landlord mortgage rather than an owner-occupier
mortgage.
What
is the difference between a buy to let mortgage and a residential mortgage?
With
a residential mortgage (ie: a mortgage on an owner-occupied house), the total
mortgage repayments are based on the applicant's salary. However, since a buy
to let mortgage is used to finance the buying of a property for rental purposes,
the borrower must prove that the rental income will cover the buy to let mortgage.
How
much rent will I have to charge?
Typically,
the monthly rental should be between 125% and 150% of the monthly mortgage interest
payment to cover the buy to let mortgage.
Why
use an independent buy to let mortgage broker?
The
buy to let mortgage market is very complicated. With around 40 buy to let lenders
offering hundreds of different mortgage products, the choice is not always straightforward.
Independence is important to ensure you get the best deal for your situation.
What's
the difference between mortgage brokers?
Some
mortgage brokers, such as Mortgages
for Business, specialise in buy to let mortgages and have been in the
market since the beginning. Their knowledge of the buy to let mortgage market
and established links with key mortgage lenders means that they can offer
buy to let mortgage deals generally not available elsewhere.
What
types of buy to let mortgage are available?
There
are basically two types of buy to let mortgage currently available: a repayment
buy to let mortgage or an interest only buy to let mortgage.
A
repayment mortgage is most suited to the investor who wants a small property portfolio
or is using the property as an alternative pension plan. Since a repayment mortgage
ends on a set date, you can plan it to coincide with your retirement. Interest-only
buy to let mortgages allow the investor to re-gear their property capital and
add other buy to let properties to their portfolio.
How
do I apply for a buy to let mortgage?
Contact
an independent buy to let mortgage broker who can help you through the buy to
let mortgage maze. By reviewing at your specific circumstances and requirements,
an independent mortgage broker can help you decide whether to take out a repayment
buy to let mortgage or an interest-only buy to let mortgage.
