How a mortgage broker can help when you are looking for a buy to let mortgage
About Mansfield Mortgages
With a great team around us, we make sure that every customer is at the centre of all we do. We have a combined experience of 63 years in the mortgage and finance industry. With modern practices we work with customers all over the country, word of mouth travels far and wide!
Buy-to-Let Mortgages Explained
A buy-to-let mortgage is a type of home loan for buying property that you intend to rent out to
residential tenants for a profit. The rules around who can obtain a buy-to-let mortgage are similar to
regular mortgages but there are some key difference. It’s best to get a mortgage broker that
understands your individual situation and budget, to help you navigate the process and find the best
deal.
A mortgage broker will talk through your options and recommend the right mortgage for your
situation. Brokers can search the whole market and have access to deals that are not available on
the high street. They will also advise on how much you can borrow and prepare your application for
submission before submitting it to the lender. They will then liaise with the lender, solicitors and
estate agents, supporting you to completion.
There are a number of criteria that lenders have and they will want to check that you can afford to
take and understand the risks of investing in property. You will also need to own your own home,
whether outright or with a mortgage. You should have a good credit record and must earn £25,000+
per year. Most lenders require that when the mortgage ends you should be not older that 70 or 75
depending on the lender.
Most buy-to-let mortgages are interest only, although there are some repayment mortgages
available. If you opt for an interest only mortgage you will need to plan for how you pay for the
mortgage at the end of the term, you should assume that the sale price at the end of the mortgage
period may not repay the whole mortgage. Interest rates do tend to be higher for buy-to-let
mortgages and you will usually need a deposit of around 25% of the properties value. The maximum
you can borrow is linked to the amount of rental income you expect to generate, lenders usually
need the rental income to be 25-30% higher than your mortgage payment. You should bear in mind
that you will need to plan for times when there is no rent coming in, don’t assume that your
property will always have tenants as there may be times when the property is unoccupied, or the
rent isn’t paid and you will need to have savings to cover the mortgage payments. You should also
have savings to cover any repairs bills.
A buy-to-let mortgage is a type of home loan for buying property that you intend to rent out to
residential tenants for a profit. The rules around who can obtain a buy-to-let mortgage are similar to
regular mortgages but there are some key difference. It’s best to get a mortgage broker that
understands your individual situation and budget, to help you navigate the process and find the best
deal.
A mortgage broker will talk through your options and recommend the right mortgage for your
situation. Brokers can search the whole market and have access to deals that are not available on
the high street. They will also advise on how much you can borrow and prepare your application for
submission before submitting it to the lender. They will then liaise with the lender, solicitors and
estate agents, supporting you to completion.
There are a number of criteria that lenders have and they will want to check that you can afford to
take and understand the risks of investing in property. You will also need to own your own home,
whether outright or with a mortgage. You should have a good credit record and must earn £25,000+
per year. Most lenders require that when the mortgage ends you should be not older that 70 or 75
depending on the lender.
Most buy-to-let mortgages are interest only, although there are some repayment mortgages
available. If you opt for an interest only mortgage you will need to plan for how you pay for the
mortgage at the end of the term, you should assume that the sale price at the end of the mortgage
period may not repay the whole mortgage. Interest rates do tend to be higher for buy-to-let
mortgages and you will usually need a deposit of around 25% of the properties value. The maximum
you can borrow is linked to the amount of rental income you expect to generate, lenders usually
need the rental income to be 25-30% higher than your mortgage payment. You should bear in mind
that you will need to plan for times when there is no rent coming in, don’t assume that your
property will always have tenants as there may be times when the property is unoccupied, or the
rent isn’t paid and you will need to have savings to cover the mortgage payments. You should also
have savings to cover any repairs bills.