Buy-to-let mortgages
A buy-to-let mortgage is for you if you want to buy a property as an investment, rather than living in it yourself. It works a little differently from other mortgages but our Melton Mortgage Solutions advisers will help you understand how much you could borrow and find the right deal for you.
Buy-to-let mortgages are specifically designed for people wanting to invest in property to generate income from it.
When you buy a property as an investment, you won’t be able to fund your purchase with a normal residential mortgage. You’ll need a buy-to-let mortgage.
Many buy-to-lets are provided on an interest-only basis, so your short-term outgoings will be less each month. You will, however, need to pay off the full loan, or refinance at the end of your mortgage term. You will also need a deposit of at least 25% of the property value. This could mean better rates on your repayments.
Finally, the amount of rent you can charge depends on the type of property you choose, how you furnish it, the market at that time, and who you’re trying to attract as a tenant.
Choosing the right buy-to-let mortgage
There are two types of buy-to-let mortgage:
Regulated buy-to-let
This type of mortgage is for a property that you or a member of your family will occupy either now or in the future.
Consumer buy-to-let
There are mortgages where people let out a property but originally had no intention of doing so. We refer to these as ‘accidental landlords’.
It typically happens when the property has been inherited or when the owner, having previously lived in the property, cannot sell it and decides to let it out.
Top tips for getting a buy-to-let mortgage
Work out your budget
Know how much you’ll have to spend before you start looking for a buy-to-let property. Generally, the minimum income you need is £25,000 a year. You’ll also need enough for a deposit, so try to start saving as soon as possible.
Do your research
Before you sort out the mortgage, you’ll need to take some time to research the type of property you’re going to buy and the area it’s in. Are your ideal tenants young professionals or a family?
Some buy-to-let investors look for properties near where they live, thinking it will be easier to keep an eye on it. While this can help, it’s often a good idea to consider places with excellent commuting links. University towns may also make perfect sense if you’re focusing on a student let.
Take a wider view
Consider properties that need improvement or renovation as this is an effective way of boosting your investment’s value.
Go and see properties at different times of the day, and take pictures and videos to refer back to later. Compare these with other potential properties.
If you’re interested in finding out more about buy-to-let mortgages, Melton Mortgage Solutions advisers can help. Simply call 01664 494100 or click get started.
Get Started
Search for your next mortgage with Melton Mortgage Solutions
To book an appointment please call 01664 494100 or click get started.
Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The actual amount will depend upon your circumstances.
The fee is up to 1% but a typical fee is 0.3% of the amount borrowed
