Mortgages for Investment Properties
Our Mortgage Service - helping you make the right decision
"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.
"We know that the internet is the first port of call for many people when looking for mortgage solutions; our view is, yes use the internet to do your own research , but then bring it to us and we’ll let you know how your findings compare and then give you the information and advice you need - so that you can make the right decision for your future.” Adam Arnott, Head of Mortgages & Protection
Compare Mortgages for Investment Properties
If you plan on purchasing a property as an investment, the exact type of mortgage you need will depend on how you plan to use the property. For example, you may be planning to use yoru investment properties for:
- Renting out to residential or commercial tenants
- Holiday lettings
- Personal use only
What type of mortgage do I need for my Investment Property?
The type of mortgage you require will vary depending on usage. If you plan to use the investment property for personal residence or occasional use only, you should be able to use a standard residential mortgage to purchase the property. However, if you plan to rent the property out as a holiday let, even if only occasionally, you are likely to need a specialist mortgage and adequate insurance to cover this different use.
Buying investment properties for long term rental will require a specialist buy to let mortgage which will be calculated based on your expected rental income as well as other affordability factors.
Buy to let mortgages for investment properties
If your investment property requires a buy to let purchase, then you should expect to pay a higher minimum deposit (usually at least 20%) and should therefore also expect lower loan to value (LTV) mortgage deals. While some residential mortgages offer LTVs of over 85%, buy to let mortgages for investment properties are more likely to have an LTV in the region of 60-75%. Buy to let mortgages can also incur higher interest rates and arrangement fees, so you will need to factor these costs in when considering buying an investment property using a buy to let mortgage.
Bear in mind that affordability on a buy to let mortgage will take anticipated rental income into account, which means that the mortgage lender will want to have a good idea in advance of how much rent you plan to charge for the property. You will need to demonstrate that the market rate for rental income on the property you want to buy is at least 125% of the mortgage repayments.
If you are unsure about what mortgage product is suitable for you to speak to one of our mortgage advisers click here »