Let to buy mortgage

lowis

if things go to plan i hope to look into let-to-buy in the not too distant future.

how exactly do they work? what factors are taken into consideration? equity, income, rental income?

I have about £100k equity in my current property and could let it out for about 900-1000 a month and my mortgage payment is just shy of 400 a month.

would those figures be attractive to a lender when consdeiring a let-to-buy application?

toonfish

lowis wrote: »

if things go to plan i hope to look into let-to-buy in the not too distant future.

how exactly do they work? what factors are taken into consideration? equity, income, rental income?

I have about £100k equity in my current property and could let it out for about 900-1000 a month and my mortgage payment is just shy of 400 a month.

would those figures be attractive to a lender when consdeiring a let-to-buy application?

they'll snap your hands off - generally the rent has to be between 100-130% of the mortgage payment, depending on the lender for it to be assessed as self funding.

kenshaz

payless wrote: »

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

But a nice guy.

Mr_helpful

payless wrote: »

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

I have no doubt Payless is a nice person but being a poor salesman can have its consequences. Life assurance is very important but mis understood by the public. Lack of life assurance and will planning can leave a partner or family with a massive IHT bill or at the mercy of the DSS and virtually in poverty. Clients rarely want to talk about dying and so salesmen fudge it but it along with taxes is a certainty. I know salesmen are tarred with a bad brush in this country but there are times when they can be the good guys.

lowis

yes, but how do they work out what to lend you - what do they consider? my salary, my possible rental income, equity release? can any of the mortgage advisors enlighten me without obv breaking the rules of the board?

payless

Mr_helpful wrote: »

I have no doubt Payless is a nice person but being a poor salesman can have its consequences. Life assurance is very important but mis understood by the public. Lack of life assurance and will planning can leave a partner or family with a massive IHT bill or at the mercy of the DSS and virtually in poverty. Clients rarely want to talk about dying and so salesmen fudge it but it along with taxes is a certainty. I know salesmen are tarred with a bad brush in this country but there are times when they can be the good guys.

I said poor salesman not poor adviser !

toonfish

lowis wrote: »

yes, but how do they work out what to lend you - what do they consider? my salary, my possible rental income, equity release? can any of the mortgage advisors enlighten me without obv breaking the rules of the board?

they'll just base it on the rental income

payless

Let 2 buy is usually the name given to the new residental mortgage, and this is calculated against earned income.

The existing mortgage ( poss converted to B2L ) is often discounted in calculations so long as potential rent cover mortgage ( differeent lenders use different calculations / requirements of proof)

Do you have depoist for new property, or would this be borrowed against existing property first?

lowis

thanks, i would need to release equity from the property i am in for the deposit.

based on the 100k equity, mortgage of 400 and possible rental income of say 900per month and my annual salary 27.5k - do i have enough at my disposal to get together about 160k? actually, i guess I need to see a broker

payless

Not enough info there to be sertain, but would guess its OK.

Broker assistance would likely be of use in a Let 2 buy situation, as they will know the different ways lenders go about things.

make sure the broker is knowledgeable in L2B, and if charging a free that you are happy