1 year mortgage?????

Moomum

I think he wants a one year fix,not a one year mortgage.
Can then remortgage after that year rather than being tied in for two or five years. Possibly wrong though.

holly_hobby

Essentially you're looking for a mortgage with no early repayment penalties after the first 12 mths - which isn't too difficult.

However, I think your plan re future letting may need re-considering.

Thats because if the LTV remains at 80% (quite likely if only 12 mths from purchase) the issue is that BTL lenders only offer 75% ltv for first time landlords, additionally most require you to also hold a resi mge in addition to the BTL. So there are possible issues to be considered with this plan.

An alternative, when the time comes, would be to seek "consent to let" (CTL) with the existing lender - however they don't always agree, and if they refuse you're back to the BTL scenerio (as letting without permission is a breach of your mortgage T&Cs and invalidates your blds insurance - which is a further T&C breach).

On balance, it may be best to consider delaying your purchase until you have completed your training, unless you will be able to reduce your borrowings to 75% (re sourcing a BTL lender) just in case your CTL app is refused.

Hope this helps

Holly x

maninthestreet

Have you considered all the extra responsibilities (and costs) of being a landlord?

Annisele

Some other thoughts...

If you're talking about letting to students, you're possibly into HMO land.

If you mean you're going to be moving away from the area in January 2014, you might find that no students are interested in a let beginning before October 2014. Student lets often run along with the academic year.

Tenants don't always pay the rent. You suggest your finances will be "stretched" - what happens if the boiler packs up and the tenants refuse to pay anything?

holly_hobby

Two great and valid points raised by Man. and Anni.

Yes - letting to student/s is another no-no for many BTL lenders, as are lets of HMO situs.

Notwithstanding that, it may be worth mentioning (but may have changed since I was involved in this), is that if you live in close proximity to a Uni. some of them operate a student accomodation retention programme (overspill to their student accomodation reqs).

Essentially the Uni lets the property from you (and subsequently themselves place students in the accom - any issues with the students you refer to the Uni).

Importantly the Uni pays you rent equally spread over the entire calender yr, as oppossed to the academic one (as is typical with student let) - ensuring that the unit is retained for next yrs residency reqs, with I think the typical contractual requirement of the uni, being a 3 yr term. (as I say this scheme/arrangement offered by Uni's may have changed in recent yrs).

Hope this helps

Holly