Re: Self Employed, Guarantor Mortgage and Buy To Let

kammyk

Hello,

Hoping to get some advice on what options we have to get a Buy To Let.

Me and my wife are both 28 and currently living with my parents and will continue to do so for the foreseeable future. I am self employed earning approximately 25k per year. My wife is not currently working.

We have managed to save 100k to put towards a deposit for a property (currently looking at property's that are in the region of 350k). We are hoping to get a buy to let mortgage but due to my low income and being self employed we are not sure we are able to?

My parents are more than happy to act as Guarantors and they own two houses that are fully paid for with a total value of approximately £800k


My main questions are :

1. Will we struggle to find a mortgage because of my low income / self employed

2. What is the minimum deposit needed - could we put down a lower deposit on the buy to let and further down the line invest in a second by to let property rather than putting all our saving into one property.

3. Are there any brokers specialising in Guarantor mortgages / self employed / low income.

Thanks for your help guys.

HappyMJ

1. A BTL mortgage is based on the rental income the property can achieve your income isn't always taken into account

2. Minimum deposit for a BTL is usally 20% but some require more.

3. Yes there are.

Now saying all that a BTL mortgage usually requires you to be an experienced landlord already owning a property that you let out or be an owner occupier.

I've also got to say what if the tenants don't pay rent for a period of time. You need to cover the mortgage repayments no matter what and based on that level of borrowing you could find yourself in a lot of trouble very quickly.

My advice....should you wish to take it...is to buy a property for £100k in cash and let that out for at least a year before considering buying another one on a BTL basis. You'll then be an experienced landlord and if the rent isn't paid on that one property you won't have mortgage interest payments to make and it shouldn't cost you that much to maintain whilst not getting an income before you get a possession order and eventually send the bailiffs in to regain possession. You'll get your landlord experience with little risk.

amnblog

1. It will make it difficult as will the fact you do not own your own home.

2. Yes you can.

3. You need a buy to let experienced broker

kammyk

Thanks for your advice guys.

I really do not think buying a property for 100k cash is possible especially in the area I am looking for.

Are there any recommended mortgage brokers that will match my needs? I am really in the early stages of the whole process so a personalised service from a mortgage broker would be ideal.

Amnblog do you have any recommendations ?

dimbo61

So let me get this straight!
You are a first time buyer
You earn £25K a year from self employment
You want to borrow £250,000 which is 10 times what you earn
You have NO history of being a Landlord and have never owned a property.
Your wife does not work.
Why are you not looking at buying your own home to live in ?

Let_Us_See

I suspect your proposed income to debt ratio will even prevent a BTL application and I do not know of any BTL provider offering a guarantor scheme.

kammyk

Thanks for your advice guys.

So my options are quite limited for now it seems. Are there any steps you guys recommend to increase my prospects of purchasing a house in the near future? For now all I can do is save more for a deposit but then with house prices increasing its quite difficult to getting anywhere close to purchasing.