Buy to Let

The buy to let property market is booming throughout the country. Demand is constantly rising meaning that property prices keep going up. There is also a consistent, growing demand for rental properties, ensuring a steady stream of rental income. Contact Book My Mortgage to see how we can help you break into the property market or expand your property portfolio.

Residential vs Buy to Let Mortgages

What most hopeful landlords need to know is that buy to let mortgages are not the same as conventional residential mortgages. Different criteria apply and you cannot take out a standard residential mortgage on a property you plan to rent out.

If you do this and your lender finds out you could be forced to pay back the entire borrowed amount immediately. They might also put penalties or fines in place and make you switch to a higher mortgage rate.

What are the Differences?

Higher Rates

Larger Deposits

Higher Arrangement Fees

Additional Lending Criteria

How much you are able to borrow on a buy to let mortgage is not determined based on your income but rather according to the rental income the property will likely be generating.

Do I Qualify?

Many lenders require that clients are over a certain age before they will permit them to take out a buy to let mortgage. They also ask that you have an income which will easily cover the mortgage during times when the property is unoccupied.

Interest Only Mortgages

Most buy to let mortgages are interest-only meaning that monthly payments are smaller.

Capped Mortgages

With this type of mortgage, landlords might see rates vary each month, but they will not go over a certain percentage.

Discounted Mortgages

With this type of buy to let mortgage the lender is offering a rate lower than their standard one.

Fixed Rate

This kind of mortgage comes with a guarantee that landlords will pay a constant rate for the duration of their mortgage.