Let to buy mortgage

brock-cruse

Hi
Our potential buyers are going to let out their property to their mum and get one of the above mortgages to buy a bigger house. Can anyone explain simply how this works? Will they be able to provide a deposit if they have no savings? Any info appreciated.

Mr_helpful

Its easy. the original property is turned over to a buy to let Often people remortgage and raise deposit for the house that they are buying. Then they buy new house in normal way. The BTL gets discounted because it is self financing.

payless

Becoming a very popular route these days

MortgageMamma

I love let to buys, but I don't get many opportunities to do it. sad, arn't I?

Ayrshire_2

MortgageMamma wrote: »

I love let to buys, but I don't get many opportunities to do it. sad, arn't I?

Why ?? What is it you love about them ?

toonfish

Ayrshire wrote: »

Why ?? What is it you love about them ?

2 lots of proc fees and double the life cover

mystic_trev

payless wrote: »

Becoming a very popular route these days

But why? New entrants to the BTL Market are imediately into negative gearing! This is a disaster waiting to happen. From Landord to DSS Tenant in one easy move!

Ayrshire_2

toonfish wrote: »

2 lots of proc fees and double the life cover

Ahhh so it's not the deal itself that brings the joy ... it's the financial rewards No shame in that.

Although i assume it also depends on the structure of the BTL 'business' as may not always need double life cover etc.

payless

sometimes cheaper to get consent to let rather than rebroke on to B2L ( less income but better for client) erspecially if its not for a long term

Why immediately assume double life cover sale ...whilst some people may want all debt covered - surely the overall assets ( say at forced sale) less liabilities on death needs to be looked at, and this is not that much greater.

Perhaps the above is whats makes me a poor salesman

payless

mystic_trev wrote: »

But why? New entrants to the BTL Market are imediately into negative gearing! This is a disaster waiting to happen. From Landord to DSS Tenant in one easy move!

To be honest its not always about becoming a longtime landlord, instead it might be a short time way to avoid hassles of selling before buying.

MortgageMamma

Its not just about financial reward
most times I obtain consent to let as it works out better for clients who are normally still within their incentive periods anyway

I love it because I love helping people achieve their dreams, I've only done 2 let to buys this year and my clients are always astounded there's a way around what they want to do. This is where us brokers come into our own.

I like being paid like anyone else but If i was doing this job for the money I'd have quit last year when I had nowt!