Can I use my equity as a deposit

02472

I am looking at buying a buy to let property and was wondering if I can use the equity on my house to get a deposit for the buy to let?
I have 120k equity, 10k cash and was looking at a 100k house.

holly_hobby

Yes, you could either apply for a further advance with your curent lender, or remortgage (whilst releasing equity) with an alterantive lender (subject to status and income of course).

To source a suitable buy to let mortgage you may wish to consider engaging the services of a whole of market mortgage broker (to give you access to as many providers as possible), as there are a number of BTL lenders whom only accept intermediary business.

Minimum deposit as a first time landlord would be 25% (ie max LTV 75%), with rental income 125% of mortgage interest (use 6% as a ballpark calc figure), withs some lenders also requiring a minimum earned income of 25K.

Please consider all the responsibilities and outlay involved in becoming a landlord before you jump in, as whilst getting it right can make the role hugely rewarding, getting it wrong can bring no end of grief ..... tread carefully, inc thorough research into the lettings market in your chosen area, to ensure that the exercise will be profitable and beneficial to you.

Hope this helps get the ball rolling.

Good luck

Holly x

02472

Than you Holly!