Zero hour contract buy to let mortgages

Lokolo_2

Morning all, hope you are well!

I am considering buying an investment property later this year, most likely end of summer 2020. My situation is a bit complex as I work on a zero hour contract. I am likely to be able to provide 18 months worth of income proof in summer 2020 in the form of pay slips from my agency.

I guess what I am asking is, does anyone have experience or knowledge of what it is like getting a BTL mortgage whilst on a zero hour contract and what should I do to be best prepared for applying for one?

I plan to downsize and sell my current house to use a bit of that equity as well as savings I have built up to put towards a deposit for the investment property. Considering the price range of places I am looking at, i will easily have a 25% deposit. I have read that some lenders care more about the potential rental income than my personal income, but I am wondering if my low income of around £25k will cause an issue if I need a BTL mortgage of say £125k? I own my current home outright so my expenditure is fairly low, affordability shouldn't be an issue at all even with interest rate rises but of course my job is not secure!

Apologies for the long thread and thank you in advance for any insight and advice! :j

ACG

There are a few things you need to have in general for BTLs:
- 25% deposit - you have.
- £20-25k income - it seems you have it or are very close.
- Own your own home - you have.

There are lenders who do not have a minimum income requirement and there are lenders who will be fine using 0 hours contracts with 12 months evidence. I think you will have enough options available to you in order to be getting deals at the better end of what is available.

Lokolo_2

ACG wrote: »

There are a few things you need to have in general for BTLs:
- 25% deposit - you have.
- £20-25k income - it seems you have it or are very close.
- Own your own home - you have.

There are lenders who do not have a minimum income requirement and there are lenders who will be fine using 0 hours contracts with 12 months evidence. I think you will have enough options available to you in order to be getting deals at the better end of what is available.

Hello ACG, thank you so much for your input, that is encouraging! My plan is to keep saving as much as I can in the meantime so that I can increase my deposit further!

I am not sure if the income requirement is before tax or after, as that is quite a difference for me, before tax and deductions it would be around 34k but after all those taken off it's about 24k net as I have to pay employers NI as well as my own NI, income tax, umbrella company fees and pension contributions!

Realistically would I be best off going via a broker to get a BTL mortgage or would I stand a chance applying by myself and saving their fees?

Thank you again for your input and any other views are welcome