Buying a property to rent

jordan_gibson

Hi - in need of some advice please.

Currently own a house with my now ex. I thinking of buying her out and then renting the house out.

What mortgage would I need on the property. I have heard of a buy to let one - what is the score with this. Are the monthly payments less than a normal mortgage and is being a landlord really worth all of the hassle???

Ta

Gorgeous_George

All depends on house value and rental income.

Likely to be not worth the hassle at the moment but all depends on the numbers and what you want from the investment.



GG

abaxas

Go for it providing.

1) You can still pay the mortgage at 7% rates
2) you can still pay the mortgage if no-one occupies your property for 3-4 months
3) You can pay to refurnish the flat after someone takes everthing when they leave.
4) You can take the hassle of getting a county sourt summons each time you make deductions from the deposit.
5) You are aware that you cannot complete a sale on the property during an AST, also 2 months notice for eviction.
6) You understand 'Houses do not always go up in value.'
7) You are aware that rents are current lower than even an IO mortage on most properties.

Sorry for being negative, but if your asking the question you've head the positives. You NEED to be aware of everthing before you enter into this.

(The value of property can go down as well as up. Your home is at risk on ANY debt you have, including any BTL mortages)

clutton_2

""You are aware that you cannot complete a sale on the property during an AST"" -

it is perfectly possible to buy a house that has a tenant in situ, as long as the Lender approves the AST which is in place at the time.

silvercar

"Do you own another property? If so... you could remortgage that and then pay cash to buy your ex out and have no mortgage on the rental property but... then you'll be liable for income tax on (nearly) all the rent paid to you.
"

Not true, if the purpose of the loan is to fund your BTL you are entitled to tax relief on it. This is irrespective of where (or indeed if) the loan is secured.

PoorDave

abaxas wrote:

7) You are aware that rents are current lower than even an IO mortage on most properties.

Most properties? Don't think so! Depends on your area. A while back you could do BTL easily in lots of parts of the country as the figures stacked up really well. Now it's not so easy, however, that doesn't mean people should make sweeping statements about the whole of the country. The OP does not live in "average-town", so should look at their own situation.

Having said, that, i agree with the rest of your points completely!

PoorDave

pokem02 wrote:

Lenders will lend a maximum of 85% AND your expected rental income has to be 125% of the mortgage interest payments (point 2).

It is possible to borrow 90%. Talk to a mortgage broker.

Also 125% doesn't apply with every lender, again, talk to a broker.

Not saying what you're suggesting is a good or bad idea, just pointing out some slight misinformation, based on what i have picked up when researching similar schemes.