Renting out my house - do I need a BTL mortgage?

kitkat84_2

Hi

I currently rent out my house which is on a great BTL mortgage deal. Unfortunately, the deal I am on is due to end in October and the mortgage company I am with have stopped offering new deals. My choices are to stick with them and my rate will go up by about 3% or find a new deal.

The difficulty is that my LTV is about 84% - all the BTL mortgages I have seen so far are about 70-80% max.

So, do I have to have a BTL mortgage? Or can I look at 'regular' mortgage deals as well?

All help is appreciated!

Thanks
Kat

Senior_Paper_Monitor

If you are going to rent it, yes you do - and with it currently rented and on a BTL absoluteley no way to hide it.

JonnyTwoToes

I rent my flat out but it is not a BTL. I have an 'arrangement' with HSBC that they simply approve every year. I have a lower LTV though - about 60%.

holly_hobby

JonnyTwoToes wrote: »

I rent my flat out but it is not a BTL. I have an 'arrangement' with HSBC that they simply approve every year. I have a higher LTV though - about 60%.

That "arrangement" will be the lenders Consent To Let.

Consent To Let is possibly available (subject to the lenders acceptance), when you intend to leave your main residence (the one the lender holds the mge on) and rent it out.

The lender may refuse their consent, but generally it is given. You may be taken off any mge deal you are on and/or have an interest rate loading applied.

As the OP is already renting the property out, and intends to rent the property following completion of any new mge - then it has to be a Buy To Let application she makes.

Max LTV is 80% - The Mortgage Works are one provider that considers such a LTV.

Rental income must be equal to at least 125% of the mge payments, based on a rate (75% - 80% lending) of either 5.99% or the actual interest rate (product) chosen - which ever is the HIGHER.

Hope this helps

Holly

JonnyTwoToes

holly_hobby wrote: »

That "arrangement" will be the lenders Consent To Let.

Consent To Let is possibly available (subject to the lenders acceptance), when you intend to leave your main residence (the one the lender holds the mge on) and rent it out.

The lender may refuse their consent, but generally it is given. You may be taken off any mge deal you are on and/or have an interest rate loading applied.

As the OP is already renting the property out, and intends to rent the property following completion of any new mge - then it has to be a Buy To Let application she makes.

Max LTV is 80% - The Mortgage Works are one provider that considers such a LTV.

Rental income must be equal to at least 125% of the mge payments, based on a rate (75% - 80% lending) of either 5.99% or the actual interest rate (product) chosen - which ever is the HIGHER.

Hope this helps

Holly

This is correct.
One stipulation I had to abide by was to have the property empty for 3 months before renting it out - maybe you could look at that as an option if you want to give Consent to Let option a try? Would that be an option Holly?

kingstreet

Kensington has an 85% BTL deal.

It's 5.99% fixed for 2 years with a fee of 2.5%.

This may put into perspective the OP's current reversion rate.

kitkat84_2

Thanks everyone.

Looks like until I have a better LTV I should stay where I am - the standard variable rate is currently less that 5%