Buying first property for cash -where to find the best deal?
Discussion
As the title I'm about to delve into buying a property for cash (long story - working overseas as a contractor for many years and can't get a mortgage)
I'm a first time buyer, I don't own any other property. Several mortgage advisers have informed me that if I have a property - then I'll be able to get a mortgage after 6 months as I'll no longer be a FTB.
I've cash to purchase and am looking at spending under 70k in the west midlands (as I have family there)
Can anyone help on a good way to source a property that I could rent out? any other wonderful money making suggestions would also be appreciated.
I'm a first time buyer, I don't own any other property. Several mortgage advisers have informed me that if I have a property - then I'll be able to get a mortgage after 6 months as I'll no longer be a FTB.
I've cash to purchase and am looking at spending under 70k in the west midlands (as I have family there)
Can anyone help on a good way to source a property that I could rent out? any other wonderful money making suggestions would also be appreciated.
I did that last year, same sort of reason, not woried to much on the property as did not intend to live there, we bought from the estate of a deceased lady, I just made a low ball offer, S Wales, 70% of asking price, they accepted, they tried to push me up and I refused. Put the money into my lawyers account 12 hours after accetance, they moved heaven and earth to get the cash as quickly as possible.
digger_R said:
As the title I'm about to delve into buying a property for cash (long story - working overseas as a contractor for many years and can't get a mortgage)
I'm a first time buyer, I don't own any other property. Several mortgage advisers have informed me that if I have a property - then I'll be able to get a mortgage after 6 months as I'll no longer be a FTB.
I've cash to purchase and am looking at spending under 70k in the west midlands (as I have family there)
Can anyone help on a good way to source a property that I could rent out? any other wonderful money making suggestions would also be appreciated.
The six month rule isn't because you'd no longer be a FTB, it's due to Money Laundering concerns. Also, it can be done before six months with some lenders but only for the purchase price you paid for it.I'm a first time buyer, I don't own any other property. Several mortgage advisers have informed me that if I have a property - then I'll be able to get a mortgage after 6 months as I'll no longer be a FTB.
I've cash to purchase and am looking at spending under 70k in the west midlands (as I have family there)
Can anyone help on a good way to source a property that I could rent out? any other wonderful money making suggestions would also be appreciated.
I'd also suggest that any issues that prevented you from getting a mortgage initially may still be present after six months, unless your circumstances will have changed then?
@Berw How did you find the property, via an estate agents/right move?
@sarnie I've moved back to the Uk and am looking for contract work, my intention would be to get a B2L mortgage for a seconds property with a significant deposit. My understanding was that the barrier to me getting the mortgage in the first instance relates to not being a home owner.
@sarnie I've moved back to the Uk and am looking for contract work, my intention would be to get a B2L mortgage for a seconds property with a significant deposit. My understanding was that the barrier to me getting the mortgage in the first instance relates to not being a home owner.
digger_R said:
@Berw How did you find the property, via an estate agents/right move?
@sarnie I've moved back to the Uk and am looking for contract work, my intention would be to get a B2L mortgage for a seconds property with a significant deposit. My understanding was that the barrier to me getting the mortgage in the first instance relates to not being a home owner.
No, not being a home owner wouldn't stop you. We do plenty of mortgages for First Time Buyers who are also First Time Landlords.@sarnie I've moved back to the Uk and am looking for contract work, my intention would be to get a B2L mortgage for a seconds property with a significant deposit. My understanding was that the barrier to me getting the mortgage in the first instance relates to not being a home owner.
What will stop you, is being a contractor, with only 6 months UK history....
digger_R said:
I'm guessing a significant cash deposit wouldn't help?
No.You have to satisfy ALL lending criteria.
Most BTL lenders have minimum salaries of circa £25k for example. You could have a million pound deposit, but if your income wasn't over £25k then they'd decline it.
A Large deposit helps but it doesn't override other lending requirements, which for you are going to be at the very least, 12 months Contracting history...........
Feel free to PM me the address of any house you're interested in and i'll use my agents logins to get any extra details, marketing history and road information/prices etc.
It can sometimes be useful to know how long houses have been on for, if they have been marketed previously and not sold, price changes etc.
It can sometimes be useful to know how long houses have been on for, if they have been marketed previously and not sold, price changes etc.
digger_R said:
Ouch, the reality is somewhat harsher than I thought.
Yep, BTL applications are now underwritten with largely the same underwriting criteria as residential mortgages.Long gone are the days of simply providing a deposit and stating that the mortgage payment will be "X" and the rent will be "X + 25%" and lenders accepting that and issuing mortgages I'm afraid........
As a self-employed person you will be subject to the same lending criteria as if you were buying a house to live in.
nikaiyo2 said:
Sarnie...
Not sure if they still exist but would TMW's "let to buy" products be worth considering?
ie, purchase one with outright cash, then use the equity in that to secure a loan on another property? Or have i completely gotten the wrong end of the stick lol
Not entirely sure what you mean, but LTB is when you are letting out the residential property you live in, to buy another, which isn't what the OP is doing.Not sure if they still exist but would TMW's "let to buy" products be worth considering?
ie, purchase one with outright cash, then use the equity in that to secure a loan on another property? Or have i completely gotten the wrong end of the stick lol
Even so, for reference, TMW's Proof of Income Criteria states;
"Acceptable proof of income:
Self employed applicants: Latest SA302 (self assessment tax calculation form)*"
http://www.themortgageworks.co.uk/lendingcriteria/...
To get a SA302, you need to submit annual accounts to HMRC, which the OP won't have either.....
Sarnie said:
Most do, but some will do it on 12 months.......expect to pay for that flexibility though...
Thanks for the reply! Also, theoretically... if OP was to create a ltd company to hold his property (bought with cash) and the turnover / rental income allowed him to take a salary and dividend of circa £25k per annum, would this satisfy the lenders requirement for a salary / income of above £25k? I ask because i was under the impression lenders prefer a source of income separate to property - would this get around that fact? So he could get further lending in his own name or via the company...
FrankAbagnale said:
Feel free to PM me the address of any house you're interested in and i'll use my agents logins to get any extra details, marketing history and road information/prices etc.
It can sometimes be useful to know how long houses have been on for, if they have been marketed previously and not sold, price changes etc.
PM on the way It can sometimes be useful to know how long houses have been on for, if they have been marketed previously and not sold, price changes etc.
trowelhead said:
Thanks for the reply!
Also, theoretically... if OP was to create a ltd company to hold his property (bought with cash) and the turnover / rental income allowed him to take a salary and dividend of circa £25k per annum, would this satisfy the lenders requirement for a salary / income of above £25k? I ask because i was under the impression lenders prefer a source of income separate to property - would this get around that fact? So he could get further lending in his own name or via the company...
No......lenders with £25k minimum salary restrictions are standard lenders who want to lend to individuals, not Ltd companies which would be verging on Commercial lending. In that instance they would be lending directly to the Ltd company, as the company owns the property not the individual, and most mainstream lenders will not lend to Ltd companies. There are specialist who will lend to Ltd companies but don't expect cheap rates or low fees......Also, theoretically... if OP was to create a ltd company to hold his property (bought with cash) and the turnover / rental income allowed him to take a salary and dividend of circa £25k per annum, would this satisfy the lenders requirement for a salary / income of above £25k? I ask because i was under the impression lenders prefer a source of income separate to property - would this get around that fact? So he could get further lending in his own name or via the company...
Appologies for slightly off thread but Sarnie as you are a broker perhaps you can help.
I have 3 of my BTL mortgages coming to the end of the fixed rate term next month, they are on student rental properties and I put 40% deposits in to them. Since my wife and I took out the mortgages we have both effectivly retired, although only 53. We can now very comfortably live off the rental income and my military pension.
If I wish to remortgage are there any companies that will consider us with no actual salary from paid employment? We are currently with Godiva.
I have 3 of my BTL mortgages coming to the end of the fixed rate term next month, they are on student rental properties and I put 40% deposits in to them. Since my wife and I took out the mortgages we have both effectivly retired, although only 53. We can now very comfortably live off the rental income and my military pension.
If I wish to remortgage are there any companies that will consider us with no actual salary from paid employment? We are currently with Godiva.
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