FTB or BTL?

Padstow

Daughter rents a lovely little house, right across the street from a major hospital. The LL has given notice that he intends to sell it next year when her tenancy is up.

I've had the worst financial year of my life having had the rug pulled from beneath my feet, surviving in a huge house with bills to match on £142 pw due to her efforts. Faced repo but a buyer came forward at the eleventh hour to purchase for 150k below original asking price. Still better than repo.

She has worked nights through Christmas etc to keep us both and I'm now able to help her purchase her house with a decent deposit as repayment. That's repaying her, plus 8% pa simple interest, which she doesn't want, but will get. Adds to 25%+ deposit at the very least.

All that is straightforward, except she intends to either work in the Middle East or experience London hospitals at some point, leaving her to rent the house out.

So, is it possible for her to purchase as a FTB then switch to BTL later if she goes abroad?

Also the price. I forecast the asking price of £126,500, but saving all fees for the seller, £124,000 IMO would be reasonable. No hassle, no fees.

kingstreet

You purchase a residential property with a normal residential mortgage. If, later, you wish to let the property, you ask the lender for consent to let.

If, in time, you decide you will never live in the property again and it is to be let on a permanent basis, you would then consider remortgaging to a more formal buy to let mortgage product, probably with a specialist lender.

Padstow

Thankyou kingstreet, that all makes perfect sense, thanks.

kingstreet

It may be worth bearing in mind there are a couple of lenders, First Direct and GE Capital, which I believe never grant consent to let.

Additionally, Halifax demands a change to a higher-rated, fee-charging product for three years and Nationwide adds a premium to its standard rate.

I'm not suggesting she puts the "cart before the horse" but the issue of the cost of CTL should be factored-in to choosing the initial lender and product.