Advice needed

o0topcat0o

Hi,

I was just after a bit of advice if possible, I have taken voluntary redundancy from my job, due to finish in December with my redundancy pay to follow the week after.

I am hoping to invest some of the money in a buy to let property. I know I couldn't get a buy to let mortgage until I am in a new job for 6 months or so, but I was wondering if there is any way I could get the mortgage while im still in my current job? The problem being that I wont have the deposit money available until December.

Yorkie1

I am no expert but you'd have to disclose your redundancy situation to the lender, and I'd expect many - if not all - to be very reluctant to lend.

Nothing to stop you going to a broker and seeing what they advise, though.

G_M

The key factors for a BTL mortgage are NOT your personal income but

* the deposit you put down (25%+) and
* the rent you will receive (125% of mortgage repayments)

Talk to an independant mortgage broker

o0topcat0o

Thanks for the advice,

Ill talk to a broker, I thought that I had read somewhere that you had to be in employment with an annual income over £25K. Probably imagining it.

Just one more quick question.....At what stage will I have to hand over the deposit? Like I said, I wont have the money until mid December but would like to start house hunting now.

kingstreet

Some lenders ask for a high personal income, some don't.

As long as you have a decent deposit and the rental income is around 130% of the monthly mortgage interest based on an annual rate of around 7%, it should stack up.

Here's an example;-

Buy for £150,000. You need around £37,500 deposit, leaving a 75% LTV mortgage of £112,500.

At 7%, the mortgage interest would be £656, so the rental income would have to exceed £850 per month to make the proposition stand up.

Rates and terms vary from lender to lender, so a whole market broker is definitely the right route for this.

The deposit will be needed when you exchange contracts/complete, so you need to delay your purchase until around Sept/Oct for a completion in December.

o0topcat0o

kingstreet wrote: »

Some lenders ask for a high personal income, some don't.

As long as you have a decent deposit and the rental income is around 130% of the monthly mortgage interest based on an annual rate of around 7%, it should stack up.

Here's an example;-

Buy for £150,000. You need around £37,500 deposit, leaving a 75% LTV mortgage of £112,500.

At 7%, the mortgage interest would be £656, so the rental income would have to exceed £850 per month to make the proposition stand up.

Rates and terms vary from lender to lender, so a whole market broker is definitely the right route for this.

The deposit will be needed when you exchange contracts/complete, so you need to delay your purchase until around Sept/Oct for a completion in December.

Thanks, very helpful post.

Ive done the calculations and mine seem fine. Ill go and see a broker and get the ball rolling.