mortgage help please!!

elljay20

Hi guys. My other half and i are looking at getting a house in the near future. Where we live now we have accomodation that comes with his job and we're quite happy where we are but at 27 and 33 years old we need to be getting our foot on the property ladder. we want to buy to let but we will struggle to get a 15% deposit together so do we HAVE to say we're going to be renting it out when we apply for a mortgage? Also i've never bought before but my parner had a mortgage with a previous girlfriend for about a year so am i right in thinking that we are not classed as first time buyers even thiough i am?
Thanks

cattie

Yes you do need to tell the lender you will be renting the property out as it's a BLT mortgage you will need & it'd be fraud to try to buy it on a residential mortgage.

The term ftb can be applied to anybody who hasn't a property to sell, so is in a chain free position. In the past there were beneficial terms offered for ftb mortgages, but those days are long past.

elljay20

Thanx cattie. If we bought a property to live in what would we have to do if six months down the line we moved out and rented the house out?

AndrewSmith

elljay20 wrote:

Thanx cattie. If we bought a property to live in what would we have to do if six months down the line we moved out and rented the house out?

You would have to inform the lender as it will have implications on the property insurance and type of mortagge product you have, ie classification of it being a regulated (residential) or non-regulated (semi commercial, buy to let) mortgage, each with their own Terms and Conditions.

The vast majority of lenders will be more than happy with the decision to let the property however do not forget that untill you have repaid the mortgage in full the lender still technically owns the property, thus has every right to know what you are doing with it.

Andy

elljay20

thanks. so okay let me get this straight. If we buy a property and move in whilst renovating etc and have say a years worth of mortgage repayments under our belt and THEN move back into our free accommodation and inform the lender of our intention to let there probably wouldn't be a problem and no change to the mortgage etc?

Tassotti

Why bother moving.

What are you aiming to achieve with a BTL?

Your mortgage company will need to know you are letting it and may issue a chare and change the interest rate

elljay20

Because we don't actually need anywhere to live with a btl we can get our foot on the property ladder whilst also using the rent towards paying off our mortgage. It's just that property round here is expensive and a 15% deposit (around 22,000) will take a good while to raise.

silvercar

you'll be hard pushed to find somewhere that the rent will cover the mortgage with so little deposit. If you sole reason is to get on the housing ladder before prices go up, I would be inclined to wait and see how prices move.

If your determined then the way to go is to buy on a residential mortgage, live in it for a few months then rent it out by asking your lender for permission to do so. If you tell the lender it is a temporary situation (less than 3 years) they may well allow you to do so for a fee, rather than insist you change the mortgage to a formal BTL mortgage. You will have to hope the property holds its value - they are not going to want to do it if the mortgage exceeds the property value.

elljay20

Aren't house prices on the rise?
Sorry but i really am ignorant on the whole subject.