First time buyer

shaz77_2

I have planned to purchase a business premises along with another person with the intention of buying to let. Bidding for the premises ends within 2 weeks and we are going to apply for a mortage immedietly. We can easily put down a lump sum which is worth around 25% of the property, however we do require an additional 70k. The one problem is and its quite a big one is that we were until recently students and have yet to find full time employment. With proof of earnings gone is our chances of getting a mortgage also gone?

h4nym

At the moment, without an income you're going to be in real trouble! Also, you need to make sure that you can find a lender prepared to offer 75% on commercial premises - most won't entertain anything over 65%.

Commercial is a whole different animal to residential - and as a small and highly leveraged landlord, you'd be in real trouble! Commercial property tends to be rented by a tenant for much longer periods than residential, but if you don't have a tenant, you can expect MUCH longer vacant times. How would you pay the mortgage if your property was empty for, say, a year?

Don't think that a year of vacancy is excessive! Companies tend to stay in premises for 5-20 years, that's the quid pro quo.

If you had lots of properties, and/or you didn't weren't mortgaged for loads, then you could sustain vacancy much better.

I'd really counsel you against this move!

H

shaz77_2

Thanks for that response.

One point I should make is that I can realistically see it being no more than one month until we are both in full time employment. However the problem with this of course is that the closing date is before this and when we go to look for a mortgage we will not be employed. Would offering a piece of land against the mortgage reassure some banks?

Another point is that the property is ready to move into so no time would be lost with renovations etc.