Buying To Let

Thinking of buying a property that you can rent out to tenants?

A Buy to Let scheme is perfect because it gives you::

• regular income from rental payments, whilst the property is tenanted.
• opportunity to invest in a large asset which has the potential to increase in value

This type of mortgage allows you to pay all your mortgage repayments using the income received from rent. Once the mortgage has been paid, you will have full ownership of the property, which you can then continue to rent and receive extra income or sell up and receive a large cash sum.

How much am I able to borrow?

Mortgage lenders will generally base lending on Rental calculations. However, a mortgage lender will consider your personal circumstances to decide how much you can borrow. This will include your potential rental income so you may be able to borrow more money if your income rises from the rental payments on the property you plan to rent out.

With a buy to let mortgage you can pay the Lender Arrangement fee upfront or add it to the loan. Please note, if you add the fee to the mortgage, you will pay interest on the amount added for the life of the mortgage. Potential landlords also have the option of fixed rate loans but remember, the longer the rate is fixed, the higher the rate interest.

Are there any disadvantages in buying to let?

Although buying to let can reap considerable financial rewards, becoming a private landlord can be a risky and complicated way of making money. We advise all potential landlords to seek appropriate advice before going ahead with this type of mortgage. Factors to consider include:

• Acquisition, disposal and maintenance costs including agents fees, stamp duty, furniture and fittings, insurance, management and repairs.
• Decrease in rental income as a result of increased rental property in the area or deteriorating condition of the property.
• Increase on interest rates on mortgage loans without a corresponding increase in rental payments.
• No guarantee that house prices will continue to rise.
• Difficulties with tenants i.e. failure to pay rent, breach of tenancy agreements, periods of no tenant in the property.

Potential landlords should also look into insurance policies that cover theft or damage by tenants and a loss of rent.

Whatever your circumstances we’ll find a Buy to Let mortgage that’s RIGHT for you!

For all the advice you need, contact Wise One on: 0161 776 2508 or click here and get a FREE Quote today.

Note: We can advise on both Business Buy to Let (BBTL) and Consumer Buy to Lets (CBTL). Of the two, only Consumer Buy to Lets are regulated by the FCA.