First time buyer

bluesnake

kingstreet wrote: »

Buy a property on a residential mortgage with the intention of letting it from day one?

Where in my posting did I suggest this? I just put forward an idea. Are you hinting he should do this as a money saving tip - not a bad idea, is a money saving site?

I also never said he should grow grass there and pay it off in a few months, or turn it into a brothel and rent each room per hour, or lay a patio to hide bodies.

bigadaj

bluesnake wrote: »

Where in my posting did I suggest this? I just put forward an idea. Are you hinting he should do this as a money saving tip - not a bad idea, is a money saving site?

I also never said he should grow grass there and pay it off in a few months, or turn it into a brothel and rent each room per hour, or lay a patio to hide bodies.

Maybe not but still fraud, with associated problems when tenants don't pay, they wreck the house, the house burns down and insurance doesn't pay out.

You, sir, are an idiot.

kingstreet

bluesnake wrote: »

Where in my posting did I suggest this? I just put forward an idea. Are you hinting he should do this as a money saving tip - not a bad idea, is a money saving site?

I was asking you a genuine question, not making any assumptions. I wanted to see if you were suggesting the OP commit mortgage fraud, or were simply mistaken.

He should not use a residential mortgage if his intention is to let the property immediately he owns it.

He's also unlikely to get a BTL mortgage without a current owned property. There are some people who think it's acceptable to use such products to circumvent the residential mortgage income rules and as the OP has a relatively low income, that may be a suggestion made by some.

Money saving site? Yes.

Place to get advice on committing financial crime? No.

bluesnake

bigadaj wrote: »

Maybe not but still fraud, with associated problems when tenants don't pay, they wreck the house, the house burns down and insurance doesn't pay out.

You, sir, are an idiot.

Thank you. Nice to know I'm in good company! Is that the most productive thing you have to say!

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kingstreet, nothing illegal ever went through my mind. I was of the opinion any one could get a BTL, if the finance were there and they matched the risk rules/quota etc..

So you must own before you can buy. So he can purchase if one of his parent/sibling owns, and he buy with him/her/sibling?

What is the approx different between btl and normal one?

kingstreet

Lenders are wise to the low-income FTB trying to buy an unaffordable property by using the BTL rental income formula;-

rent must = mortgage interest @ 6%pa (ish) x 125% (ish)

to get round the residential rules, so they are unlikely to allow FTBs to buy to let, if they don't already have an owned home.

TBH I don't know if buying jointly with an existing owner would work. That would depend on a lender being willing to accept one FTB borrower. There may be one willing to lend, I've never tried.

Rates are probably a bit higher on BTL, with higher application costs. However, BTL is still widely available on Interest-Only with no repayment vehicle, as it is accepted the sale of the let property may be the method of repaying the mortgage.

bluesnake

personally I am stunned that purchasing at £65000 and having a £20000 - 30% deposit does not get you a ticket into the btl game.

Living at home and overpaying that mortgage the first few years is a real benefit. Single guy, paying in an extra £400pm for 5 years, plus rent, could be close to being paid off

bigadaj

bluesnake wrote: »

personally I am stunned that purchasing at £65000 and having a £20000 - 30% deposit does not get you a ticket into the btl game.

Living at home and overpaying that mortgage the first few years is a real benefit. Single guy, paying in an extra £400pm for 5 years, plus rent, could be close to being paid off

Like kingstreet I thought your original post was an encouragement for fraud.

The rules on btl are fairly straightforward, and often quoted in answers on this forum, I apologise if my comments offended but we're talking fairly basic points for any landlord.

To get a btl mortgage most lenders will not only want to see someone who owns a property but a minimum income of twenty grand is a minimum requirement.

Also, again often quoted here, is that btl is a business with costs and risks, including those I listed before. The OP would have to consider these, as well as do local research into the market, rents, voids etc to come to a reasonable decision.

bluesnake

bigadaj wrote: »

....we're talking fairly basic points for any landlord.

To get a btl mortgage most lenders will not only want to see someone who owns a property but a minimum income of twenty grand is a minimum requirement.

Also, again often quoted here, is that btl is a business with costs and risks, including those I listed before. The OP would have to consider these, as well as do local research into the market, rents, voids etc to come to a reasonable decision.

The OP is 21 years old, sounds fairly green to this market, and although he never asked this question, it could benefit him from 20 years of payments if he goes down this route.

if he is wise and calculates risk, he may be able to retire at 40 and have an income still coming in too

R_P_W

Retire at 40 from renting out one property? On what planet? OP wont qualify for a btl mortgage anyway

bigadaj

bluesnake wrote: »

The OP is 21 years old, sounds fairly green to this market, and although he never asked this question, it could benefit him from 20 years of payments if he goes down this route.

if he is wise and calculates risk, he may be able to retire at 40 and have an income still coming in too

Fair enough, still advocating fraud, I revoke my apology you really are an idiot.