Buy to Let Mortgage Deposit
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 buy to let market mortgage rates
- Access to exclusive buy to let loan deals not available on the 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 20% equity or deposit, call our buy to let mortgage team 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.
Buy to Let Mortgage Deposit
If you are considering taking out a mortgage for an investment property, such as a buy to let, one of the key things you may be interested to find out is exactly how large of a deposit you would be required to put down.
As a general rule buy to let mortgages are more expensive than their residential counterparts. While it may be possible to secure a homebuyer mortgage with a deposit of around 5%, lenders tend to require borrowers to have a deposit of 25%. As with most forms of finance, the larger the buy to let mortgage deposit you can afford to place the better the interest rates available to you will be.
However during an application there are various personal details about a borrower that may affect the size of deposit a lender would require for a buy to let, such as:
- Age – Some lenders can be reluctant to offer mortgage finance to borrowers who will be aged 70 or over by the end of the mortgage term, as such they may require a lower Loan to Value depending on the borrower’s age. However, there are a selection of lenders who will accept applications from people aged 70 or over.
- Credit history – Borrowers who have had problems with credit in the past may be required to put down a larger deposit than borrowers with better credit scores. While having a poor credit score will limit the buy to let mortgages out there, it does not necessarily preclude someone from being able to get a buy to let product. Similarly, credit history will also affect the interest rate a lender will be willing to offer potential borrowers of buy to let mortgages.
Another key difference between buy to let mortgages and homebuyer products is the way the affordability is calculated, which affects how much you can borrow. When applying for a homebuyer mortgage, lenders usually calculate a borrower’s affordability based upon a multiple of their annual income. However, with buy to let mortgages, lenders often calculate affordability based upon the estimated rental value of a property. They generally require the property’s monthly rental yield to be at least 145% of what the monthly mortgage payments would be.
It is important to note the recent changes in the buy to let mortgage market in relation to affordability. From 2017, lenders will no longer consider the landlord’s property in isolation but review the landlord’s entire property portfolio. As a result, landlords can no longer spread their equity across their portfolio and lenders will refuse to provide a buy to let mortgage if one or more of the landlord’s properties are not profitable.
In addition, lenders will apply a stricter income stress test and only grant a buy to let mortgage so long as the landlord can afford mortgage repayments in the event that the interest rate increases to 5.5%.
How to Get a Buy to Let Mortgage
Whether you’re already a landlord or you are thinking about purchasing your very first investment property, you may benefit from enlisting the services of an independent mortgage adviser. Not only can whole-of-market advisers offer you impartial advice throughout the process, but they can use their expert knowledge of the market to search across different providers to find the top buy to let deals for your needs. There are also a selection of mortgages offered by specialist lenders that can only be applied for via an adviser, one of which might be the right choice for you.
To find out if Fair Mortgages could help you, why not fill in our online contact form to request a call-back for a free initial consultation from one of our advisers? Alternatively, you can contact us direct.