Buy to Let mortgage, Vs First time buyer mortgage? what are the differences?

gemmaking

What are the differences in the 2 mortgage types:

buy to let mortgage, VS first time buyer mortgage?

one offers better rates? one offers lower interest rates?

one requires a lower deposit % down payment?

Deed names?

one has more hidden costs?

one requires more work?

(I know you have to do the one you require) - but am just curious to what the differences are, in both types of mortgages.

GMS

A Buy to Let mortgage is for a property to be rented out, not for a residential property.

In theory a first time buyer mortgage could be a Buy to Let one assuming a forst time buyer looking to buy a property to rent out.

What are your intentions?

shortchanged_2

GMS wrote: »

A Buy to Let mortgage is for a property to be rented out, not for a residential property.

In theory a first time buyer mortgage could be a Buy to Let one assuming a forst time buyer looking to buy a property to rent out.

What are your intentions?

I think they are looking at any way they can to get an IO mortgage.

https://forums.moneysavingexpert.com/discussion/4237235

grey_gym_sock

a FTB mortgage, assuming that means a residential mortgage for FTBs, is not very different to any residential mortgage.

a residential mortgage is generally lower rate and lower minimum deposit than a BTL mortgage.

Simon_gloster

Getting a buy to let mortgage for ease of interest only with the purpose of livng there is fraud. Its not been said but its f@@@ing clear you are thinking of it.

Anyway, this will be another failed attempt as lots of lenders dont do FTB buy to let mortgages.

Believe it or not, lenders are sophisticated enough to spot trends and when people change circumsatnces that seem out of the ordinary.

This app is fraught with bad news and most brokers would walk away from it. Just do repayment over the longest term possible if the most important thing to you is keeping the cost down.

gemmaking

Simon_gloster wrote: »

Getting a buy to let mortgage for ease of interest only with the purpose of livng there is fraud. Its not been said but its f@@@ing clear you are thinking of it.

.

you are jumping to conclusions, please relax !


buy to let mortgage, VS first time buyer mortgage?

one offers better rates? one offers lower interest rates?

does one type offer lower rates? or not?

holly_hobby

They are 2 completely different animals .... ones semi- commercial borrowing, ones residential ....

Semi-commercial borrowing = higher interest rates than residential borrowing to reflect the risk exposure to the lender.

Does that answer your question ?

Whats the purpose of the q ... as in the first place, you aren't comparing apples with apples ....

Hope this helps

Holly

_Andy_

oh god here we go again

GMS

gemmaking wrote: »

you are jumping to conclusions, please relax !


buy to let mortgage, VS first time buyer mortgage?

one offers better rates? one offers lower interest rates?

does one type offer lower rates? or not?

You already know one offers better rates. As Holly says one is commercial and one isn't.

If you are trying to manufacture an application then don't do it.

Post is quite frankly ridiculous. What exactly are you trying to gain and/or avoid?

holly_hobby

_Andy_ wrote: »

oh god here we go again

Yep, just had a read through of the thread mentioned.

Obviously the OP is looking for a backdoor route to interest only borrowing - by going the old buy to let route (an exercise as old as the hills for those with insufficent income or wanting IO when otherwise refused. And an exercise which the lenders are now onto, or have now chosen not to turn a blind eye to !).

OP - despite your comment to Simon that he has jumped to conclusions re your question regarding btl v ftb - it is really quite obvious even to a simpleton, the thought process you are having .... I don't mean to be nasty in that comment, but please give us some credit for the obvious.... !

IF you do proceed down the BTL route (so that you can source an interest only primary mge, because you can't afford a repayment one), and actually find a lender whom will accept your status as a First Time Buyer (ie - no mge history) - you have the issue of a 25% deposit, poss evidence of a tenant and AST (plus some demand management with an ARLA letting agt), and upon discovery of your fraudulent applicaton (which it WILL be), the lender immediately switching you onto a residential C&I mge OR demanding immediate redemption (ie - repayment of the mge) - notwithstanding that they may initiate legal proceedings.

So there you have it ... there's not much to be added I feel, except to say if you do continue down this avenue, you'll have no one to blame but yourself when it all goes pear shaped ... and trust me it will sooner or later ....

Hope this helps (if not exactly what you want to hear or accept)

Holly

Milky_Mocha

I saw this thread title and thought, yes I'd like to know the answers to that too...but I'm in no way trying to make a fraudulent application!!

I'm in a situation where I'd like to purchase a property as a long term investment but also close enough to home as I tend to have lots of friends/family staying over at one time or another and it would be great to have another place nearby available at times. So basically, I won't need to have tenants to be able to afford payments but it would be a waste to keep it empty pretty much all the time. I'm thinking of using it for very short term lets of perhaps a week or fortnight or month at a time.

If buy to let mortgage is a better deal then I'd go with that. If it turns out to be much worse a deal than residential mortgage then I'd rather not rent it out and hold on to it.

If anyone does eventually give more info on the differences between the two I'd be interested to know. In the meantime I'll carry on my research :-)