Buy to let advice

desperate-dan_5

Hi,

I am posting on behalf of my parents they want to buy a property to rent out to me. I have recently been declared bankrupt and have a young child they want us nearer to them and know I could pay the rent every month.

However they do have a big mortgage of approx £240 and house is worth £360. They earn £60,000 per year between them. Would this be possible if they had a 25% deposit they also have car finanace so would this be taken in to consideration?

Thankyou.

herbiesjp

The Buy To Let would be based upon the going market rate for rental on the property they are looking to buy

Being let to you, means that it would be classed as a "regulated" Buy To Let and therefore reduces the number of options available to you.

However as long as the rental income covers the mortgage payment by around 130%, they may have some options.

Best plan would be to discuss with a whole of market mortgage adviser

desperate-dan_5

Well if it limited the options they wouldnt say it was being let to me at the time of sorting out the mortgage, as obviously they could judt be buying the house to let out to anyone. So how would this work?

herbiesjp

That would be fraud

There are plenty lenders that could do this for you the legal way

Even if you were to move in after say someone else, the T&Cs would state it could not be family (ith some lenders) So you would be breaking the T&Cs

desperate-dan_5

Ok fair enough why is it a problem if it's family?

So doing it the correct way how will it limit the situation and is there any u would recommend they bank with RBS and have been advised they are good?

My main concern is if they would even be considered with their current mortgage or us this not taken in to account?

herbiesjp

Ok fair enough why is it a problem if it's family?

Because it comes a regulated BTL mortgage.

It is not a problem for lenders that do regulated BTL mortgages

So doing it the correct way how will it limit the situation and is there any u would recommend they bank with RBS and have been advised they are good?

As not all lenders do regulated BTLs it limits the number of lenders available.

However the ones that do regulated BTLs are decent enough anyway

My main concern is if they would even be considered with their current mortgage or us this not taken in to account?

As explained, as long as the monthly mortgage payment is covered by the rental income by 130% (this margin differs with lenders) then they will be fine even with their existing mortgage