Buy to Let & New Home Purchase

rufus33rufus

Hi,

My husband and I are looking to move house soon we currently live in a 2 bed flat which we would like to rent out and then buy a family 3 bed house for us to live in. There are identical flats to ours which are currently rented out so we know the potential market is there for rental.

Please could someone explain how buy to let mortgages work? Do we need two deposits for the two mortgages? Do we convert the mortgage we currently have or move house as normal and then set up a new buy to let mortgage in addition? Are 100% mortgages still available? Are they a wise move in the current climate?

I've had a look at some basic guides, but am rather confused by all the information out there.

It is just an idea at the moment so any hints, tips and advice would be most welcome.

Thanks :j

Conrad

You will njeed 10% deposit minimum.

These let to buy cases are fairly complex, with plenty of pitfalls (1 example - will the new lender require your exisiting lender to give permission to let, and if so will the existing lender grant it).

I'd suggest you have a word with an experienced whole of market adviser to get this all pre setup prior to looking at a new home.

Note on the new property a 90% mortgae has to be on captial and interest basis and the rates are fairly high.

rufus33rufus

Thanks Conrad - I think specialist advice is needed. I think we might just sell the flat as we've been told today that the rental market's not all that great round us at the moment as everyone's trying to do the same and we'd actually be able to make money on the flat as we bought it so cheap which is lucky for us.