Earnings required for a 190k BTL - Self Employed / 1Yrs Accounts

ognum

swooph wrote: »

I havent seen a specific house of interest yet, but at a glance I'd be looking around a purchase price of 250k ish, and be able to put down anything between 25% and 35%

Rental income on the types of houses I'm looking at has been quoted as 1600 - 1900pcm

I too would be interested in which area you can buy a house for 250k and let for 1900£ , if OP won't say can anyone else suggest this area.

Notmyrealname

swooph wrote: »

Hi guys, bit of info needed from the experts....

With the current products available, what sort of profit will I need to earn in my self employment to be accepted for around 190k mortgage borrowing? Buy to Let or residential

Also, I only have one years accounts, are there lenders that will accept this and how will it affect my options?

Thanks for your help

Residential, you've got no chance until you've got at least 3 years certified accounts.

BTL: You'll need a 35% deposit and the monthly rental value will need to be at least 130% of the mortgage interest.

dimbo61

Student land in central manchester/liverpool/sheffield/birmingham IF you can get HMO and maintain to good standard

celyn90

ognum wrote: »

I too would be interested in which area you can buy a house for 250k and let for 1900£ , if OP won't say can anyone else suggest this area.

Oxford. Rents are really high here.

edited to add - dimbo beat me to it with student lets - a lot are HMOs here as well - three bed semi, lounge + dining room - five rooms at £400+ a month (about normal room rate here). Property isn't cheap here either but a little way out of the centre, you'd find something for 250K.

kingstreet

Do you struggle to get standard BTL mortgage funding for these HMOs, or are they still let on a standard single AST?

As an example, this is from TMW's criteria;-

Houses in Multiple Occupation (HMO)
Properties let on a HMO basis are classified as:
The property occupied by 5 or more people, comprising 3 or more households (being unrelated persons)
A property subject to Houses in Multiple Occupation licensing
A property containing no more than four habitable storeys and no more than one kitchen
Properties consisting of more than one self-contained unit under a single title are not acceptable
Rental cover will be assessed on a multi-tenanted basis up to 65% LTV
Experienced landlords only
Let to Buy, Light Refurbishment, and Limited Company applications are not accepted
All properties will be subject to an Assured Shorthold Tenancy agreement of a minimum of 6 months, maximum of 12 months
Single and multiple tenancy agreements accepted (multiple tenancy agreements - maximum 4 tenants)
A Specialist Security valuation will be required

They also increase the standard rental premium from 25% to 50% as well.

dimbo61

Joint tenancy agreement with all the students living at that address.
Commercial loan

estelle123

Where is this house for 250k that u can rent out for 1600-1900.I WANT 2..

ognum

celyn90 wrote: »

Oxford. Rents are really high here.

edited to add - dimbo beat me to it with student lets - a lot are HMOs here as well - three bed semi, lounge + dining room - five rooms at £400+ a month (about normal room rate here). Property isn't cheap here either but a little way out of the centre, you'd find something for 250K.

Thanks for this, I live in a similar place to Oxford, you really can't get a three bed semi that is big enough to convert to 5 bedrooms for 250k.

£100 per week is achievable in the city centre but houses are just not that price!

places that are far enough out of the centre to be that price do not achieve that weekly rent

gingin_2

We've asked almost the exact same question this week. We've got 17 months accounts and can't get anything until we have 2 years. Our mortgage advisor has come up with £3250 fees 3.65%, rising to 4.15% above base rate, based on a £130k mortgage with a £70k deposit - min deposit is 30%. There were other quotes, but all similar, all require at least 2 years accounts.

Edit : This is for a btl mortgage.