Mortgage Buy to let advice

ashp_2

Hi all,

My partner and I are considering applying for a buy to let mortgage but are unsure if we should or not. We earn just over 50k a year between us and have been looking at some buy to let options.

We are unable to apply for a first time buyer mortgage as we live in company housing and will be letting any property we buy. We have seen a number of 2 bed propertys around the 40k mark in the Yorkshire area. We don't currently have a deposit but we could easily raise 25-30% deposit by selling one of our cars.

I am a HSBC advance customer and my partner is a normal current account holder. HSBC have been persistently emailing me with buy to let mortgage offers and I am more and more tempted to apply.

I do have a default on one of my old HSBC joint accounts with my ex in which we where about £8 overdrawn and didn't realize for 3 months and resulted in a default. This is due to come of my credit report in a couple of months.

We do have a loan and a couple of credit cards (all with HSBC) up to 18k which are all well managed. HSBC have lended to both of us plenty in the past and we have always repaid without issue.

So my question really is. Would it be sensible to apply for a 40k mortgage based on rental income (we can easily afford to pay it ourselves as we don't pay rent). We would be looking at an 8-10 year mortgage I guess.

We are likely to be living in company housing until we retire (another 35 years at least! :shocked:) and are trying to put ourselves in the best position for that.

Thanks in advance for your help.

betmunch

depending on the terms of the company housing you may be able to get a normal residential mortgage for this even if you are going to rent it out.

Go speak to a broker who will do a full fact find and advise on the best route

amnblog

A few problems here.

1. Non householders are not welcomed as buy to let borrowers within the market with very few exceptions.

2. The purchase price you suggest sounds pretty problematical. Lenders have minimum value limits.

You need a mortgage broker to stand any hope of lending.

As a further comment, a potential landlord who needs to sell a car to raise a deposit needs to think very carefully if this type of investment is right for them.

ashp_2

betmunch wrote: »

depending on the terms of the company housing you may be able to get a normal residential mortgage for this even if you are going to rent it out.

Go speak to a broker who will do a full fact find and advise on the best route

Thanks for your reply.

I am a Farm manager and I am required to live here as part of my job. My house is let to me on a tenancy by the company to which i pay £30 a month in rent, Yes only £30.

I will look into some brokers. Thankyou.

ashp_2

amnblog wrote: »

A few problems here.

1. Non householders are not welcomed as buy to let borrowers within the market with very few exceptions.

2. The purchase price you suggest sounds pretty problematical. Lenders have minimum value limits.

You need a mortgage broker to stand any hope of lending.

As a further comment, a potential landlord who needs to sell a car to raise a deposit needs to think very carefully if this type of investment is right for them.

Thanks for your reply.

I see your a mortgage advisor so maybe I'm being naive.

1. Using the HSBC mortgage finder I am able to select "first time buyer" and "buy to let" mortgage when carrying out the search it does not state this would not be accepted and they keep emailing me about buy to let mortgages never normal mortgages.

2. I wasn't able to search mortgages anything below 40k on the website. Anything below that did not meet the minimum criteria but it seems to me 40k does.

In response to your further comment. I don't need 2 cars let alone one. I choose to own a 15k sports car but I don't need it. If that could be better put towards a house I would certainly do that.

Thanks again.