Buy to Let with Northern Rock what to do?

moira2403

Taken out 2 yrs ago @ 5.19% ends 1.11.08. Standard variable 7.49% so payments go from a manageable £540 to an astronomical £769.90 and rent receiving nowhere near being in line. Any ideas?:eek:

_Andy_

Depending on your situation there are a few lenders that will take part rental, part earned income.

In fairness you would have known about the 'astronmical' jump in your mortgage offer and could have prepared for the rise.

Other option (probably more sensible) obviously is to sell up.

koexelek

_Andy_ wrote: »

Depending on your situation there are a few lenders that will take part rental, part earned income.

.

Very few these days, but I think C & G will still look at this kind of thing

Ian_Griffiths_Halifax

What is the loan amount and value? What is your rental income before any Letting Agents deductions?

I've done a few Buy to Lets recently and C&G (unfortunately, as they are pants) and The Mortgage Works seem to be coming up with decent deals on low LTV deals.

koexelek

Ian_Griffiths_Halifax wrote: »

I've done a few Buy to Lets recently and C&G (unfortunately, as they are pants) and The Mortgage Works seem to be coming up with decent deals on low LTV deals.

that's why C & G's online Case-flow system is know as Case-slow in the trade

PoorDave

What is the monthly rental figure, and how much equity do you have in already? If a good deal can be achieved, but it involves putting more deposit cash in, are you happy to do that? E.g. deals 2 years ago could be 85-90% LTV to achieve a workable monthly payment, but today there are much better deals at 65-75% LTV.

Also, are you happy to sell at today's prices? Presumably you bought it two years ago...any idea of the likely return - profit or loss?

moira2403

Can't find lenders who will provide based on 85% mortgage. Probably should have been aware & done something, you're absolutely right but being less than savy in this didnt. Can't sell as probably wouldnt even raise enough to pay off mortgage. T

moira2403

15% down on £147k. £625 pcm but this could be increased. Even so not coming up to £769 + of course maintenance charges which is landlord responsibility. Know that in todays climate would not achieve sufficient to pay off mortgage.

opinions4u

Looks like you're stuck with Northern Rock then.

Your investment is currently devaluing and taking money out of your pocket monthly too.

Option (1): Sit tight, take the hit, hope NR variable mortgage rate falls and wait for the market to recover (assuming it does). Risk factor is you end up losing even more.

Option (2): Sell if you can find a buyer and repay any negative equity from savings if you can. This is probably the best option, but can you find a buyer in the current market?

Option (3): Hand in the keys to NR. Problem is, they can pursue you for any losses the incur for up to 12 years. As a taxpayer, I would want them to do so!

Option (4): Ask NR if they have any other deals that are cheaper. (I think they have you over a barrel, so this is unlikely).