buy to let mortgage guides

If you can’t purchase your investment property outright then you’ll need to apply for a mortgage. However, this will need to be a Buy to Let mortgage. A standard or residential mortgage is only suitable when you plan to live in the property.

There are differences between Residential and Buy to Let Mortgages. The main difference is the way affordability is calculated. Sometimes lenders can take your personal income into account, but usually this is secondary. There are a number of different factors to take in to account when you’re looking for that perfect mortgage; our guides can help and we’re always available for one to one advice. 

Buy to Let Mortgage Advice and Guides from a local **FEES FREE** Croydon mortgage broker
What is a credit score

What is a Credit Score

What is a credit score – Credit Scores are normally used by lenders to help them decide if you qualify for certain loans, including mortgages and credit cards.

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A buy to let property investment can provide you with an income. But you’ll need to consider Buy to Let costs, and how these costs might impact on your overall profitability.

Buy to Let Costs

An investment property can provide you with an income. But you’ll need to consider the Buy to Let costs involved.

A buy to let property investment can provide you with an income. But you’ll need to consider Buy to Let costs, and how these costs might impact on your overall profitability.

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When choosing a mortgage, you’ll need to consider different mortgage interest rates and fees you’ll be charged.

Different Mortgage Rates

When choosing a mortgage, you’ll need to consider different mortgage interest rates and fees you’ll be charged.

There are two main types of mortgage rate, there are Fixed Rates, where the interest you’re charged remains the same for several years, usually between two and five years. And there’s variable rates, where the amount you’re charged can go up and down.

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This is an ideal time to switch products.

Remortgages and Rate Switching

The first, and probably most obvious time, is the end date of your existing mortgage deal. This is an ideal time to switch products. By not remortgaging at the end of your current rate term, it’s likely you’ll end up on your lender’s Standard Variable Rate. Probably meaning your repayments will go up.

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Keyfacts Illustrations – Mortgages

The keyfacts Illustration document or the ESIS if that is given to you instead, makes it easy for you to compare the total cost of mortgages side by side because the documents contain the same information, usually presented in the same way.

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Negative Equity

A property is in negative equity if it’s worth less than the mortgage secured on it, and it’s normally caused by falling property prices.

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Capped rate mortgages are rare

Capped Rate Mortgages

Capped rate mortgages are rare, so if you’re going it alone, you’ll have to search well to find a selection of rates to choose from.

Mortgages with a capped rate are in effect variable rate mortgages. However, they have one important difference. That important difference is: an interest rate ceiling, known as the “Cap” above which your repayments can’t rise.

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what is a buy to let mortgage

What is a buy-to-let mortgage?

BTL mortgages are used when you’re looking to buy and rent out your property, rather than when you’re buying somewhere you want to live. 

Who are buy-to-let mortgages for?

Not everyone can get a BTL mortgage. Mortgage providers will almost always have certain requirements and not everyone will qualify. That said, requirements vary considerably and, as a result, it’s always worth a call to check out your position. BTL mortgages tend to be more expensive. They also require bigger deposits.

How does a buy-to-let mortgage work?

BTL mortgages are normally set up as interest only. As a result, the amount you owe doesn’t reduce. Rent from your property is generally used to pay your monthly interest. The amount you borrow needs to be repaid at the end of your mortgage, usually this is achieved by sale of your investment property.

Are buy to let mortgages interest-only?

Most BTL borrowers prefer to take out an interest only mortgage, chiefly because these have lower monthly repayments. Repayment mortgages are also available, and as a result they are becoming a popular alternative, even though repayments may be more.

How much can you borrow 

How much you can borrow typically depends on the amount of deposit you have available, your personal circumstances and the amount of rental income being received. 

Are buy-to-let mortgages more expensive?

Buy to Let mortgage carry a greater risk, as they’re not secured on the property you live in and rent payments can’t be guaranteed. As a consequence of this BTL mortgages can cost more.  Both higher interest rates and larger deposits are normal.

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LEGAL STUFF

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Massey Divall Financial Services are an appointed representative of The Right Mortgage Limited which is authorised and regulated by the Financial Conduct Authority.

The Financial Conduct Authority does not regulate most buy to let mortgages.

The guidance and /or advice contained within this website is subject to UK regulatory regime and is therefore targeted at consumers based in the UK

Conveyancing isn’t regulated by the Financial Conduct Authority.

Local Mortgage Advice for Croydon

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We do not charge a fee for mortgage advice. We offer customers fee free mortgage advice. Our expert mortgage advisers will help you get a market leading mortgage deal. We help you throughout the entire mortgage process. There are no hidden costs or surprises. Try our fee free advice for your mortgage.

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help@mdfs.co.uk
 

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