buy to let mortgage 0 cost of at present?

adriennegardner

Does anyone know how much buy to let mortgages are costing currently? I want to buy a £89,000 flat for this purpose.

_Andy_

How much deposit are you putting down?
What type of rate are you wanting?
Where have you looked so far?

adriennegardner

Hi

I am just starting to look. I can put down up to 30% but obviously would prefer as low as possible a deposit.
I need advice on what rates are available, obviously again the lowest possible. The property I want should earn about £400 a month.

Thanks for your interest.

herbiesjp

You need to give the actual figures you are looking at, to allow us to guide you on whether £400pm will justify that BTL mortgage.

Also what is your income?

Are you a first time buyer?
What type of property are you looking to buy?

adriennegardner

The property I wish to buy is valued at 85,000. I have an income of £75,000. i have worked in my job for 4 years- it is secure - and owned my own property that I am living currently for 4 years. I have no outstanding debts. And if the rent on the property I wish to buy at any time stopped I have savings of £30,000.
I could afford a £25,500 deposit.

As background:

I have a property already that I live in. The property I live in is valued at £225,000. I owe £ 160,000 on it. It is an interest only mortgage on a low tracker rate. I am paying £225 a month currently.

I want to know what sort of deposit would be required and how much mortgage companies are currently charging to set something like this up as I here it is currently hard to get a buy to let mortgage?

adriennegardner

Oh, I am looking to buy a one bedroom flat in Plymouth

luckyfool

Some Buy to Let lenders have requirements that you earn over £25k or £30k per annum, while others also insist on you already having at least one buy to let property already.

Off the top of my head you should qualify for 70% of 89k based on 400 pcm rent assuming a 125% on a 4.99% rental calculation which is common.

herbiesjp

Based on those figures you could probably find a lender agree either on 70% or 75% LTV.

It will also depend on what mortgage rate you want i.e. fixed vs variable, and how long you want the initial deal to last for.

As long as the 1 bed flat has no issue around the construction/build type - you will have several options.

Thrugelmir

adriennegardner wrote: »

I here it is currently hard to get a buy to let mortgage?

The market has changed with lending now made again on proper criteria. Thats all.

If the numbers stack up. Commercial lending is always available.

If you look at the business section of the BBC teletext service there is a loans section which gives a selection of the best BTL rates both fixed and variable. That'll give you something to do the maths on.

adriennegardner

Hi

Someone mentioned that mortgage lenders are charging 4% to set these up though..I think that is 4% of the total loan? I may have this wrong though!

luckyfool

There are lenders that charge arrangement fees on certain products of up to 3.5% of the loan amount (plus survey fees etc), however there are other lenders/products with more standard flat fees of £800-£1500.