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Property investment has always been popular. However, not everybody was able to purchase a property as it required significant amounts of money. Availability of buy to let mortgages had changed all that and many new investors have appeared on the market. To satisfy demand, lenders have started to offer many different buy to let mortgage products at the very competitive rates.
Unfortunately, due to the current market conditions, it is getting harder to find buy to let and commercial mortgages as lenders are tightening their criteria, but there is no need to get frustrated. We specialise in commercial and buy to let mortgages and will try our best to find you the most appropriate solution quickly and efficiently.
UK investors have always considered property as a safe way of investment. For the last ten years or so , UK property market has experienced continuous growth and property prices have increased dramatically. In addition to growing property prices, UK has always had and probably will have a strong demand for rental properties, making buy to let a very attractive proposition.
Buy to let properties became as common as residential and buy to let mortgages have allowed many people previously unable to purchase another house to buy an investment property.
Idea of buy to let is not new and buy to let mortgages have existed for a long time, but they were expensive and unattractive to anybody apart from professional landlords.
While assessment for residential mortgages normally based on applicants salary and property value, buy to let underwriting takes into account rental income as well. Indeed rental income is a very important and expected to exceed buy to let mortgage payment by 25-30%.
Landlord’s salary is expected to be at least £18,000 with some lenders expecting it to be as much as £35,000.
Why lenders expect that much? The answer is quite simple. Lenders know that on few occasions buy to let property will be unoccupied and they want to be sure that landlord will be able to pay mortgage payments without any problems.
To take that into account it is a good idea to assess your own resources and estimate for how long you will be able to pay that buy to let mortgage without rental income.
As with any property purchase you will need to allow some funds for conveyancing costs, removal, and possible property decoration and mortgage arrangement fees. There will be some expenses in addition to your mortgage cost as building insurance, service charges and possible repairs. Of
And last, but not least important is the choice of buy to let property itself. Right type of property and the right location are the key to your success, so don’t rush your decision, make sure that your choice is supported by the figures and demand for rental accommodation in a given area.