Buy to Let Mortgages
The main difference between buy to let and residential mortgages is the lending criteria. Aside from the valuation of the property, lenders base the size of the loan on the potential rental income in contrast with income multiples as with standard residential mortgages. Generally speaking, the rental income from the property you wish to buy must equate to a minimum of 125 per cent of the mortgage payment.
For example, if you borrow £68,000 to buy a property worth £80,000 at an interest rate of 6.5 per cent, you would have to earn a minimum of £460.41 in rent each month, which is 125 per cent of the £368.33 mortgage payment.
Your property may be repossessed if you do not keep up repayments on your mortgage
There may be a fee for mortgage advice, the precise amount of the fee will depend upon your circumstances but we estimate that it will be £495.
The Financial Services Authority does not regulate some types of buy to let mortgage.
For more information, please contact us