Buy to Let Mortgages Made Easy
The process of getting a buy to let mortgage can often be a headache, with different lenders imposing a number of different requirements and restrictions as to who can and who cannot have a loan with them. However, with considerable research and with the help of a specialist mortgage broker, finding your ideal buy to let mortgage deal doesn’t have to be a difficult and strenuous experience.
Can anyone get a buy to let mortgage?
Buy to let mortgages are usually only suitable and available for people who want to invest in the rental of housing and flats. Like any investment, there is a risk associated with investing in buying properties and renting them out. This it is why it is vital to know what you are in for and to gain advice from an expert before deciding to try and get a foothold on the property ladder.
Typically, you will find it more difficult to pick up a buy to let mortgage if you do not already own your own home, you do not have a good credit record and if you earn under £25,000. Additionally, many lenders now impose upper age limits – usually between 70 and 75.
Whilst it is harder to get a buy to let mortgage if any of the above applies to you, there are still plenty of lenders who do not view this as a barrier to gaining finance. This is where a mortgage broker can come in useful to finding the lenders who are willing to lend to you based on your personal circumstances.
Changes to buy to let mortgages
The way in which the buy to let mortgage market is regulated has changed greatly in 2017.
Unlike in years past, where a landlord only needed a rental coverage ratio of 125%, lenders now require landlords to have a rental coverage ratio of 145% and 170% for standard buy to lets and houses in multiple occupation, respectively.
In addition, landlords can no longer spread equity across their portfolio. Lenders now will review the landlord’s entire portfolio instead of looking at each property in isolation. This means that lenders will not provide a buy to let mortgage if one or more of the landlord’s properties do not turn a profit.
Lenders now prioritise the affordability of a mortgage over almost everything and implement a much stricter stress test. In order to secure a buy to let mortgage, landlords will have to illustrate that they can afford mortgage payments even in the event that interest rates increase to 5.5%.
How buy to let mortgages work
Buy to let mortgages work in a similar way to ordinary mortgages, although do have some key differences.
• Higher interest rates – Buy to let mortgages typically have higher interest rates than ordinary mortgages.
• You can only borrow 75% of the property’s value – a few may lend up to 80% and the odd one may go up to 85%, but this is very rare.
• Higher additional fees
How we can help
Our specialist buy to let mortgage advisory team can assist in the often strenuous process of purchasing the right buy to let mortgage for you. We can provide guidance and unbiased advice all the way through the application process and beyond this, ensuring that getting a mortgage doesn’t have to be a problematic and time consuming process for you.
We provide a whole of market service, which means we work with the majority of UK lenders and have access to exclusive leading buy to let mortgage rates that you won’t find elsewhere on the high street.
If you would like assistance in achieving your mortgage goals, finding the right deal for you or just advice on buy to let mortgages; call our buy to let mortgage team on 0117 403 4474 or request a call back by filling in our call back form.