BTL or residential what type should I get?

theAnarchist

Hi I am looking to get a flat and I have agreed a price with an estate agent.

But I don't want to live in it at the moment.

My plan is to let it for the first two years until I can get in a better financial position.

The problem is:

1. I cant get a BTL mortgage unless I find a 40% deposit. Which is beyond me at present.

2. I can get a residential mortgage on a 25% deposit which would allow me to get on the ladder. But it's not a BTL mortgage.

The flat would generate enough income to pay the mortgage and other costs. And after two years once I have more money behind me, I could afford to move in.

What can I, or should I do?

Thanks

_Andy_

It would be a BTL.

VIGILANT22

Quote "My plan is to let it for the first two years until I can get in a better financial position. "

Have you planned for a rental void?

Thrugelmir

theAnarchist wrote: »

And after two years once I have more money behind me, I could afford to move in.

What can I, or should I do?

Thanks

Can you afford the mortgage now?

theAnarchist

I can afford the residential but not the BTL.

And I can cover void periods. But the rental market is strong in my area and the lettting agent uses 6 months contracts.

So its a good way for me to get on the market until I can get more money behind me.

Thanks

_Andy_

If you don't have sufficient deposit for the BTL then it's not going to happen.

theAnarchist

But my point is.

I dont want to put 40% and get myself into debt.

I can afford to put in 25% to get on the ladder now. And rent it for two
two years until I have more money to invest into it.

If it wasnt for these stupid deposits I could afford to have some more money behind me.

Wutang_2

theAnarchist wrote: »

But my point is.

I dont want to put 40% and get myself into debt.

I can afford to put in 25% to get on the ladder now. And rent it for two
two years until I have more money to invest into it.

If it wasnt for these stupid deposits I could afford to have some more money behind me.

I know mate - these stupid deposits are going to ruin this country!

Cannon_Fodder

Borrowing the remaining 75% is still being in debt.

If you put down 40% deposit it would leave only 60% to be borrowed = less in debt.

If being in debt is the real concern, then don't borrow anything.

Save for 100%.

theAnarchist

Wutang wrote: »

I know mate - these stupid deposits are going to ruin this country!

They are!! Because how do they expect people to have 40% of a property sitting in the bank??

theAnarchist

Cannon_Fodder wrote: »

Borrowing the remaining 75% is still being in debt.

If you put down 40% deposit it would leave only 60% to be borrowed = less in debt.

If being in debt is the real concern, then don't borrow anything.

Save for 100%.

And how long do you think that would take??

House prices could outstrip my saving rate on an annual basis.