If you are you looking for the best buy to let mortgages deals with the lowest rates payable, or if you are not sure how much you can borrow, if you are not sure what deposit you will need, these are questions that require answers, let UK Mortgage Advice Ltd do the work for you.
Finding the right buy to let mortgage is crucial to your success as a property investor. Over the last few years, the buy to let mortgage market has boomed, and lenders have made the borrowing process easier than ever. There are a number of different buy to let mortgage products available from fixed rates, discounted variable rates, discounted rates and so on. Finding the cheapest buy to let mortgage may not always be the best option and this can be a minefield, so there are a number of things to consider when deciding which buy to let mortgage is best for you.
-A lender may offer a very cheap buy to let mortgage product which may carry a very attractive rate for a short while, it will almost certainly charge a significantly high arrangement fee . You then could be paying a high standard variable rate (SVR) when your fixed or tracker deal has finished, this is when we would need to calculate whether or not this is the best buy to let mortgage for you in terms of your cashflow as a landlord.
– A fixed rate with no extended tie would enable you to know exactly what your monthly repayments are so that you can calculate your profit/loss for that set fixed term of your tenant.
– A discounted variable rate can be very attractive when the base rate is in the favour of the landlord and buy to let investors. Monthly repayments will fluctuate according to the decrease/increase in the bank base rate or LIBOR rate.
– Some of the best buy to let mortgage products may be tracker products, that look lucrative now in times of low bank base rates, but be aware if the BBR starts to increase.
This all points to the importance of taking whole of market advice for your Buy to Let mortgage.
The amount that you can borrow will depend on the lender and the buy to let mortgage products available as this can vary. Some lenders may set minimum salary levels whereas others may need verification that you are an experienced property investor. Others may not be concerned with the level of income providing that the rental income is sufficient. In general, most lenders will calculate the maximum borrowings based on 125% rent to mortgage. Maximum lending usually will not exceed 80% LTV.
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Your home may be repossessed if you do not keep up repayments on your mortgage.