Buy to Let Mortgage - how does it work?

BobOngPnoy

Hi guys! If u are to get a BTL Mortgage with 75% LTV, is it 75% of the purchase price or the valuation amount? I'm looking into BTL investment (i know some of u might say im mad but im only doing some research for now). Anyway, here's a situation... if i bought a house (below market value) via property auction for £80,000 where 10% (£8000) were paid in auction as deposit so left with £72,000 to borrow. The property valuation is worth £100,000. With a mortgage deal of 75% LTV, will that be 75% of £72,000 or 75% of £100,000????
Another thing, with regards to property auction, i wanted to view a property but it isn't available for viewing since it's tenanted. How could i possibly buy something i haven't viewed where all that states in the description is '3-bed semi-detached. Front and back garden.' I really would like to see the house.
Thanks y'all!
jmr_1019

Gorgeous_George

The LTV (in this case, 75%) is based on the number that the lender's valuer makes up.

GG

Ian_Griffiths_Halifax

jmr, you could always knock on the door of the property and ask thetenants if they wouldn't mind you looking around at some pre-arranged time. If they are tenants, you could let them know that you are looking to buy it as Landlord and you'd be happy to continue their tenancy if you get it (so long as they aren't in arrears etc).

As for the deposit, you would need a total of 15% of the £80000 as a deposit, so £8,000 on the day of Auction and a further £4,000 at completion 28 days later usually.

It's not easy buying a property at auction with a mortgage though. Consider putting your offer to the selling agent before the Auction.

silvercar

If you are getting a mortgage, the lender's valuer will need access before they produce your mortgage offer. This could cause a problem for you if the tenants refuse access.

Ian_Griffiths_Halifax

silvercar wrote: »

If you are getting a mortgage, the lender's valuer will need access before they produce your mortgage offer. This could cause a problem for you if the tenants refuse access.

Correct. And another reason to put an offer to the selling agent before the auction. Putting a mortgage application in after the auction could be costly.