You will need a larger deposit.
With a traditional residential mortgage, your deposit could be as little as 5% of the property value, with a Buy to Let mortgage you could be expected to place a deposit of at least 25%.
Buy to Let.
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Buy to Let Mortgages.
A Buy to Let mortgage is specifically for people who are wanting to invest money into buying a property to rent out to tenants.
What is a Buy to Let mortgage?
A Buy to Let (BTL) mortgage is specifically for people who are wanting to invest money into buying a property to rent out to tenants.
BTL mortgages are very similar to standard mortgages, but there are some important differences. Some of these differences include, mortgage related fees and interest rates are usually higher and the minimum initial deposit required is more, typically 25% of the property value.
The amount you can borrow on a BTL mortgage is typically linked to the rental income you expect to receive from the property. A rental income of between 125% – 150% of the mortgage payment can be required.
Understanding Buy to Let mortgages
How are Buy to Let mortgages different?
A Buy to Let mortgage is often used as a long term income stream or retirement plan. Speak to us about how we can help you with your Buy to Let property ambitions.
Fees and interest rates are usually higher.
Lenders will often charge higher fees and interest rates for Buy to Let mortgages compared to Residential mortgages.
Borrowing amount is linked to rental income.
In most cases a Buy to Let mortgage lender will assess how much rent a property could achieve to calculate the maximum borrowing unlike a residential mortgage where the amount you can borrow is linked to an individuals income.
Can provide an excellent long-term income
Buy to Let properties can provide an excellent additional income stream and additional to this are often a sound investment for retirement planning. For investment and retirement planning we act as introducers only.