Yet another quick BTL mortgage query

lynzpower

Not off the back of K&Ps show last night, dont worry, iM not about to make an expensive mistake, just scouting around for info for someone else.

Quick question

Is it possible to get a repayment mortgage on a BTL? Or an offset/ overpaying type mortgage?

Most of the discussions in property section seem to be based on IO products for BTL, is there an alternative to this? Of course my freind is fully aware of the situation & is a silent lurker on here, and of course knows the pitfalls discussed at length.

just a quicky, dont shoot me down in flames!!
:cool:

PoorDave

lynzpower wrote:

Not off the back of K&Ps show last night, dont worry, iM not about to make an expensive mistake, just scouting around for info for someone else.

Quick question

Is it possible to get a repayment mortgage on a BTL? Or an offset/ overpaying type mortgage?

Most of the discussions in property section seem to be based on IO products for BTL, is there an alternative to this? Of course my freind is fully aware of the situation & is a silent lurker on here, and of course knows the pitfalls discussed at length.

just a quicky, dont shoot me down in flames!!
:cool:

As far as i know, a replayment mortgage is a possibility, but with most lenders stating that the rental income must be (for example) at least 125% of the mortgage payments, hence a lot of people go for an interest only mortgage to reduce payments.

I think this is what you're asking...

Presumably there's nothing to stop you overpaying on a BTL mortgage.

Not sure if this helps!

lynzpower

See what you mean there , thanks Dave.

So cos they are not getting the rental income of over 125% thats why they are not using repayment, to make the percentages stack up.

Anyone know of any lenders who do repayment BTL mortgages, had a google earlier, couldnt find much ?

poopscoop

BTL mortgages come in forms of Capital & Repayment, Part & Part and Interest Only, like residential mortgages. If you do a search on charcolonline or moneyextra.com it should show them in C&R and IO form. Also, it is usually 125% of the Interest Only monthly payment.

Also, Interest Only payments are lower as you are just paying the interest and from that they get some sort of return. If they did the C&R their return will be lower (or not at all), but it does repay the capital.

lynzpower

thanks Poopscoop, we will have a nose x

herbiesjp

lynzpower wrote:

Is it possible to get a repayment mortgage on a BTL?
Or an offset/ overpaying type mortgage?


just a quicky, dont shoot me down in flames!!
:cool:

Quick answers then :rotfl:

Yes you can have a BTL any way like a normal mortgage
Yes you can find offset or schemes that allow capital overpayments

BTL lenders agree BTL mortgages on the basis that the rental income covers the interest only portion of the mortgage amount.