With people’s lives changing more rapidly over the past 18 months, some are now opting for rented accommodation. This could be due to an unexpected location change for work or to care for a family member, or because more of us are working remotely and have the freedom to be based elsewhere.
If you’re thinking about getting a slice of the rental income action and becoming a landlord, here’s a brief guide to explain some of the important information you’ll need before getting started.
How much deposit do I need?
The minimum deposit needed for a buy to let mortgage is usually 25%. Occasionally, this can vary depending on your previous history as a landlord.
Can the equity in my current home be used for the deposit?
You may be able to do this, yes. There would be a few factors to consider; such as whether you have enough equity in your home to release or whether your mortgage lender (if the property has a mortgage) will allow you to release equity for this purpose. If you’re unsure and looking for some expert advice, our mortgage advisers will be able to provide further information on this.
How much can I borrow?
The amount you’ll be able to borrow will be determined by a number of factors; including predicted rental income and your personal income.
How much do I need to earn?
This could vary between lenders and some lenders may not even take your personal income into account; focusing on the predicted rental income instead. However, most will ask for a salary of at least £25,000.
Can first time buyers get a buy to let mortgage?
Yes. There may be certain circumstances where a buy to let property is a more logical first step - for example; if you’re in the armed forces and want to get on the property ladder but will be moving between different postings for a few years. However, a lot of lenders would prefer an applicant that already owns their own residential property.
How many buy to let mortgages can I have?
It’s possible to have several buy to let mortgages at once; however some lenders may have a limit as to how many mortgages you can have with them individually. If you have four of more buy to let mortgages you’ll be known as a ‘portfolio landlord’ which means that future lenders may assess your entire portfolio of property when you apply for a new mortgage.
Buy to let mortgage advice in Doncaster
If you’re looking to get involved in the rental market, getting advice from the experts is the best place to start. Our mortgage advisers have helped people become landlords, release funds from their property and switch their buy to let mortgages to new deals, and they could help you too.
If you’d like to make a free, no obligation first appointment with one of our mortgage advisers in Doncaster, please call us on 01302 798573 or send us an e-mail.
There is no guarantee that it will be possible to arrange continuous letting of the property, nor that rental income will be sufficient to meet the cost of the mortgage.