Advice for buy to let mortgage for first time buyers

a.ahmed0162

Me an my partner are looking to buy a property for 500k and willing to put in more than a 25% deposit  and want to borrow on a buy to let, we have approached a couple of brokers and they are unable to get us anything on the market as we do not currently own a property or are not landlords  and cannot do a buy to let as a first time buyer.

we recently approached our Barclays branch who conducted a affordability check and they have advised that We are able to apply as we have passed their affordability test and they can do a buy to let for first time buyers. 

I am very surprised that brokers were not able to get this and the Barclays branches was able to offer this to us am just worried that they will turn us down on the last minute any advise from anyone would be appreciated.
if they do reject us would this have any negative or major impact on our credit files 

Thanks 

[Deleted User]

Certain brokers just flat out refuse to do them as their is a higher than average chance that someone will end up moving in to the BTL if they dont already own their own home. 

My old company of over 600 brokers just refused if you didnt live in a home you owned.  Also if the BTL was bigger than your residential they would also refuse. 

The question would be:  Where are you living just now? Why dont you buy a house for yourself? What happens if you are in rented and are served notice, will you move in to the BTL? 

Plausibility checks come in to it and there is a chance you would get declined later down the line when it gets to an underwriter.  Depends how strong your business case is.  Also if you could afford the residential mortgage if you bought it as a residential then that works in your favour as well.  

This also works both ways though, a lot of banks dont do BTL for first time landlords at all, they have to come through brokers.

a.ahmed0162

Thanks for your reply, Currently living with my parents and I do have a lot of advantage at my current place as it’s in London and very convenient for the place of work, purchasing the property for very much investment, and don’t have any plans to move in there and with my current salary I can’t get a residential mortgage of that value the max I have been offered is 240k where else Barclays have said I can get a BTL with a 25% deposit and with a current salary of just 47k between me and my partner should be ok when he done a soft search but am just still worried they will decline with giving 350k with our salary 

[Deleted User]

a.ahmed0162 said:

Thanks for your reply, Currently living with my parents and I do have a lot of advantage at my current place as it’s in London and very convenient for the place of work, purchasing the property for very much investment, and don’t have any plans to move in there and with my current salary I can’t get a residential mortgage of that value the max I have been offered is 240k where else Barclays have said I can get a BTL with a 25% deposit and with a current salary of just 47k between me and my partner should be ok when he done a soft search but am just still worried they will decline with giving 350k with our salary 

How much rent will this £500k property achieve and do you have £15k on top of your deposit for the SDLT? 

[Deleted User]

a.ahmed0162 said:

 with my current salary I can’t get a residential mortgage of that value

And thats why a lot of lenders and brokers refuse to do it.  Because some people claim they will rent a property out but they actually move in to it.  If you know that you can get a mortgage on a BTL but wouldnt get it as a residential mortgage then some people are just happy to lie to get the property.   Not saying you are, but that's where the hesitation comes from

a.ahmed0162

So in all essence despite that I have passed the affordability test there is a high chance that I will be refused on other grounds as your saying 

[Deleted User]

a.ahmed0162 said:

So in all essence despite that I have passed the affordability test there is a high chance that I will be refused on other grounds as your saying 

Its impossible to say. Depends on the feeling the underwriter gets from the case.   I have had some very very good btl cases thrown out by lenders who thought they were going to live in it when we could swear on anything that it wasnt the case.  

I certainly wouldnt start spending money with solicitors and surveys etc until you've got an offer

kingstreet

It's possible. Lenders who do this type of business will usually test affordability as a residential proposition and think that if you could afford it as a residential you wouldn't suffer the higher BTL rates if you didn't need to. Therefore, those who don't meet affordability as a residential will usually face more scrutiny.

a.ahmed0162

Yeah makes a lot of sense, I just had the underwriter from Barclays confirm that I don’t need to have a residential property it’s something they apperantly used to do a few years back but they don’t now so am just so confused as what I should actually do

a.ahmed0162

Yeah so to be honest I wouldn’t afford it on the residential as the max I can do on the residential is 240k max with me and my wife’s current salary so that could be one of the factors? 

a.ahmed0162

Lover_of_Lycra said:

How much rent will this £500k property achieve and do you have £15k on top of your deposit for the SDLT? 

So am looking at a rental value of 1700-1900
and we have the SDLT which is no issue