Buy to Let Mortgages with 25% Deposits
Buy to Let Mortgage Service
Special features of what we offer include:
- Whole of market service - we can compare up to 80% buy to let deals from most UK lenders
- Access to leading btl market mortgage rates
- Access to exclusive buy to let loan deals not available on high street
- Fast turnaround - speak to us today if you need to move quickly
- We have lenders who will take into account previous defaults and missed payments.
- Looking to remortgage or raise additional finance on top of your existing buy to let mortgage? - we have access to a range of btl finance solutions
To investigate your buy to let mortgage options with a 25% deposit call our btl mortgage team on 0117 403 4222 or fill in our call back form.
The essence of the Fair Mortgages service is professional independent mortgage and protection advice brought to you by a team of specialist advisers and experienced administration support.
As your mortgage is such an important transaction, good advice is imperative.
Changes to the buy to let regulations
From 2017, further changes to how buy to let mortgages are regulated will be implemented that will make it harder for those looking to secure finance for buy to let properties.
Due to the changes of the regulations, lenders will look at landlords’ applications for buy to let mortgages with more scrutiny than before.
Firstly, lenders will require landlords to have a rental coverage ratio of at least 145% for a standard buy to let and 170% for a house in multiple occupation. Under previous regulations, landlords only required a rental coverage ratio of 125%. This may make it more difficult to secure a buy to let mortgage from a traditional lender.
Secondly, lenders will apply a stricter stress test to prioritise the affordability of the mortgage. As a result, landlords will have to prove that they can afford repayments in the event that interest rates increases to 5.5%.
Finally, if a landlord has more than one buy to let property, lenders will review their entire property portfolio before granting a buy to let mortgage. If a landlord has multiple properties, but only a few are profitable, then a lender will not provide a buy to let mortgage. This means that landlords can no longer spread equity across their portfolio.
Buy to let mortgages with 25% deposits
One of the key differences between residential and buy to let mortgages is the size of the deposit required to secure the loan. Whilst a home-buyer mortgage can often be granted with a deposit of as little as 5%, lenders tend to require a more significant deposit before handing out a buy to let mortgage.
Generally, buy to let lenders will ask for a deposit of around 25% of the property’s value in order to take out a mortgage. A few lenders may only ask for 20% and the odd one might ask for as little as 15%, but this is very rare. Similar to the majority of finance forms, the larger deposit you have available to put down on a buy to let property, the cheaper interest rates you will be offered.
How are the deposit requirements calculated?
The size of the deposit required by buy to let lenders is likely to be determined by a number of factors based on your personal circumstances. Along with possibly other factors, lenders will typically look at your age and credit history when determining the size of the deposit required from you.
- Credit history – Borrowers who have a history of problems with credit in the past are likely to be asked to put down a larger deposit as they are seen as more of a risky investment. The credit history of a borrower is also likely to affect the interest rate being offered on the loan.
- Age – As a general rule, lenders tend to see older investors as a bigger risk and consequently might require older borrowers to put down a more substantial deposit.
If you’re looking for a buy to let mortgage with a 25% deposit, you are likely to benefit from speaking to a mortgage broker. As an independent mortgage broker, we work with the majority of UK lenders, giving us access to leading buy to let mortgages with 25% deposits, in addition to exclusive deals not available on the high street.
As a result, we can analyse your personal situation, provide unbiased advice and compare various buy to let mortgages to find a deal that suits you and meets your buy to let mortgage goals. To further find out how Fair Mortgages can help you, why not call us today on 0117 403 4222, or fill in our online contact form to request a call-back for a free initial consultation with one of our advisers.