Advice on let to buy or BTL
Discussion
Looking to get another property to either let or sell.
I'm thinking of a let to buy.
Do I get an approval for this, then buy a house, then let existing. Or do I have to let before I buy another?
Is the general 25% deposit required 25% of the total of both houses?
Are they generally regarded better than BTL?
What is the best option for someone who is struggling to get deposit together?!?
I'm thinking of a let to buy.
Do I get an approval for this, then buy a house, then let existing. Or do I have to let before I buy another?
Is the general 25% deposit required 25% of the total of both houses?
Are they generally regarded better than BTL?
What is the best option for someone who is struggling to get deposit together?!?
BTL mortgage - not income or affordability based. Based on ROI, so usually 125% (roughly) thus every £100 of mortgage must equate to £125 or rental income plus there is a multiplier involved as well, but i cant remember what it relates to but that bumps the required income a little more...sure some else will, and usually max 80% LTV although more than 75% usually means crap rate.
Residential mortgage - based on affordability of borrower...YOU CAN rent a property on a residential mortgage, but you normally have to pay an admin fee, its £100 with natwest, i know as i have done it. Now some lenders will take into account any existing lending including outstanding mortgage borrowing, and some don't if the property has a consent to let in place, Natwest do for instance regardless, so based on income if you can borrow £400k and you have £200k on another mortgage they will only lend you the other £200k...but not all do. The benefit of this is you don't need such a big deposit, but then im not so sure its a great idea to be getting strapped up with lots of resy mortgages atm, but depends on your circumstances i suppose.
Realistically if you are "struggling to get the deposit together" its probably not the best course of action to be taking.
Residential mortgage - based on affordability of borrower...YOU CAN rent a property on a residential mortgage, but you normally have to pay an admin fee, its £100 with natwest, i know as i have done it. Now some lenders will take into account any existing lending including outstanding mortgage borrowing, and some don't if the property has a consent to let in place, Natwest do for instance regardless, so based on income if you can borrow £400k and you have £200k on another mortgage they will only lend you the other £200k...but not all do. The benefit of this is you don't need such a big deposit, but then im not so sure its a great idea to be getting strapped up with lots of resy mortgages atm, but depends on your circumstances i suppose.
Realistically if you are "struggling to get the deposit together" its probably not the best course of action to be taking.
Edited by big_boz on Monday 15th July 10:59
Edited by big_boz on Monday 15th July 10:59
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