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Buy-to-let mortgage advice re Auction Property
londontocornwall
Posts: 4 Newbie
Good afternoon all,
My wife and I are interested in buying a property we have seen at auction.
The property is a house which has been converted in to two one bedroom flats (two separate letable units), which we would intend to rent out under two separate tenancy agreements.
The solicitor we have instructed to look through the legal pack has raised a query.
We are cash buyers and would look to generate buy-to-let finance on the property @ 60% LTV at a later date (as dictated by any lender T&Cs) in order to generate a further 40% deposit to expand our portfolio, thereby maximising the return on our cash.
The issue is, would this property be seen as a commercial property by lenders and therefore make it ineligible for the best buy-to-let mortgage products on the market?
Any commercial finance would clearly be at a higher rate and therefore make the proposal less desirable.
My wife and I are interested in buying a property we have seen at auction.
The property is a house which has been converted in to two one bedroom flats (two separate letable units), which we would intend to rent out under two separate tenancy agreements.
The solicitor we have instructed to look through the legal pack has raised a query.
We are cash buyers and would look to generate buy-to-let finance on the property @ 60% LTV at a later date (as dictated by any lender T&Cs) in order to generate a further 40% deposit to expand our portfolio, thereby maximising the return on our cash.
The issue is, would this property be seen as a commercial property by lenders and therefore make it ineligible for the best buy-to-let mortgage products on the market?
Any commercial finance would clearly be at a higher rate and therefore make the proposal less desirable.
0
Comments
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You should be able to get standard btl mortgages on these properties.
A number of options if they are on separate titles, limited options if they are on the same title.I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
Many thanks amnblog. I believe the units are under one title.0
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You may have to wait a bit before you can raise a mortgage on them. Lenders aren't that keen on people remortgaging (even if there is no mortgage on the property) within 6 months of buying it.0
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It looks like some lenders stipulate a minimum of 12 moths before lending. Just concerned that we won'tbe able to get any decent rate finance on the property at all due to the solicitors concerns that it would be treated as a commercial property by lenders as it is two units under one title0
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Speak to a mortgage broker (the majority of buy to let lenders don't deal directly with the public).
As amnblog has suggested there are lenders who may consider lending if the two flats are on the same title.0 -
Many thanks Jimbo1976.
Can anyone out there recommend a good independent buy-to-let mortgage broker? I'm not overly fussed about having a face-to-face meeting. I'm based in London.0 -
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