BTL Mortgage Questions

Colin297

Hi there,

Im 27 years old and am looking to buy my first property before the end of this year - hopefully asap.

Instead of going the conventional route of buying a residential property, I firstly wish to buy an investment property. I live at home and am in a privileged position to be able to do so - and i therefore am eager to get on the ladder.

Anyway, I know people get residential mortgages for investment properties and rent them out, but I want to do things by book.

My questions about BTL mortgages therefore, are:

1) What is, realistically, the lowest possible % deposit I could ask the bank for? I see a website, seemingly some sort of broker, advertising 15% rates - https://www.turnkeylandlords.co.uk/low-deposit-buy-to-let-mortgages/ - Is this feasible?

2) Which companies will allow overpayments? I would love to have a property which pays for itself in half the time for example (not impossible IMO).

3) Should i set up a pension company to put this property in alongside further investments? Is this something people on here know much about?


Many thanks guys,

Rgds.

Colin

R_P_W

Unlikely you will find a lender for a BTL mortgage to someone who is not already a residential homeowner.

If you did find one you really need 25% deposit and the rent payments need to cover 125% of the monthly mortgage payment.

If you can afford to buy, why not buy and move out your parents and live in it?

Colin297

R_P_W wrote: »

Unlikely you will find a lender for a BTL mortgage to someone who is not already a residential homeowner.

If you did find one you really need 25% deposit and the rent payments need to cover 125% of the monthly mortgage payment.

If you can afford to buy, why not buy and move out your parents and live in it?

Because that's a good way of financially restricting yourself for the rest of your life without building a portfolio

bewilderedhelpneeded

Most btl mortgages require you to be a homeowner and to have a residential mortgage secured on it before they will lend you money for btl.

Why not buy a property for yourself and rent out a room. You can use this additional income to pay your current mortgage off quicker or to build bigger deposit for btl meaning you will have less to borrow as btl rates and fees are a lot higher than residential rates and fees

holly_hobby

As stated, either you or the fellow mortgagor must have held/hold a residential mge.

Some lenders have a min income of 25k.

Min deposit generally 25% for first time landlords, with rental income at 125% of mge interest, using 6% as a ballpark figure for all applicants.

Holding a commercial property within a SIPP (which is what I presume you're alluding to) is possible subject to various issues, see your Financial Adviser.

BTLs with unlimited overpayment/offset facilities - pretty much non-existant.

Hope the above covers the bases you enquired about.

Holly x

Jonbvn

Colin297 wrote: »

Because that's a good way of financially restricting yourself for the rest of your life without building a portfolio

Been watching Homes under the Hammmer?;)