Buy-To-Let Mortgage Help/Advice

rahulgarciapatel

I am 22 years old and have been working for about 6 months now. I have saved enough for a deposit so I can buy a flat which can be rented out in the future. However, I am struggling to find a mortagage that would give me a buy-to-let mortgage because I dont have any experiance in buying a protpery. The flat I want to buy is approx 220k and i will be putting about 50k as a deposit.

I was wondering could I purchase the home as a first time buyer but the rent the property out? My salary is high enough for me to pay the mortgage but the rental income will make it easier for me to get onto the property ladder and still have some money for me to buy my own house.


Any advice?

Pixie5740

Your £50k deposit is not enough to get a BTL mortgage on a £220k property. You would need at least a 25% deposit and remember that some of that £50k will go on SDLT, surveys and solicitors fees.

If you were to apply for a FTB mortgage, or any kind of residential mortgage, when the sole purpose of purchasing this property it to let it out would involve you committing FRAUD.

Where are you living just now? If you're renting or living with parents, why not just buy a property to live in?

rahulgarciapatel

Thanks for the reply. My parents said they would be able to help provide some funds to cover about 10k. Also I am living with my parents.

What if I buy the property and just leave for 6-12 months and then rent it out? Would that work, or does that still count as fraud seeing as I have intended to rent this property out?

Thanks

AdrianC

You would still need to get consent to let, and if the lender suspected that had been your intent all along, it may well be refused.

BitterAndTwisted

What's the projected yield on this hypothetical £220k property?

If you apply for a BTL mortgage you will need to prepare a business-plan, even if it's just on the back of an envelope.

If you apply for a residential mortgage then it's in the gift of the lender whether they will later give you permission to let the property. Only a fool would put together a business-plan on such a vague "maybe".

kingstreet

Those applying for BTL mortgages who don't already own a property will (by the couple of lenders open to them) see their income checked as the lender will assume they are using the BTL rules to circumvent the residential affordability requirements.

Those applying for a residential mortgage on a property they don't intend to occupy will see their case scrutinised to ensure it isn't a back-door BTL. Consent to let is not granted by all lenders and may be subject to a fee, higher rate or both. It will be time-limited if granted.

G_M

Good advice above. See also

* New landlords: advice, information & links

Old_Git

i was refused consent to let because I wasn't leaving the area for work purposes .

rahulgarciapatel

Ahh ok, thanks for the information. Looks like I will have to get BTL mortgage.

Thanks for all the help!