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Let to buy advise please
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Poe79
Posts: 15 Forumite

Hi,
Just looking for some basic advise on let to buy.
Sorry if I don't have all the info to hand but this is something I've only just considered so haven't researched anywhere else yet or got accurate valuations.
We own our current property or right with no debts.
The house is worth between £180,000 and £220,000 (recent sold prices on identical built houses in same road)
Average rentals seen to get £900pcm approx.
How good income £26,000 approx.
Deposit £10,000 but could raise more
Looking to buy house in similar price bracket as current house.
Did this sound feasible and would it be a good route to go down or is there a better way of keeping this house and buying another?
Many thanks,
Poe
Just looking for some basic advise on let to buy.
Sorry if I don't have all the info to hand but this is something I've only just considered so haven't researched anywhere else yet or got accurate valuations.
We own our current property or right with no debts.
The house is worth between £180,000 and £220,000 (recent sold prices on identical built houses in same road)
Average rentals seen to get £900pcm approx.
How good income £26,000 approx.
Deposit £10,000 but could raise more
Looking to buy house in similar price bracket as current house.
Did this sound feasible and would it be a good route to go down or is there a better way of keeping this house and buying another?
Many thanks,
Poe
0
Comments
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What do you intend to do with the house you already have?
If you're planning to become a self-run landlord, make sure you're aware of everything that includes.0 -
Poe79 said:Hi,
Just looking for some basic advise on let to buy.
Sorry if I don't have all the info to hand but this is something I've only just considered so haven't researched anywhere else yet or got accurate valuations.
We own our current property or right with no debts.
The house is worth between £180,000 and £220,000 (recent sold prices on identical built houses in same road)
Average rentals seen to get £900pcm approx.
How good income £26,000 approx.
Deposit £10,000 but could raise more
Looking to buy house in similar price bracket as current house.
Did this sound feasible and would it be a good route to go down or is there a better way of keeping this house and buying another?
Many thanks,
PoeI think as a rule of thumb lenders go to 4.5 times your gross income so that would be a mortgage of £117k and you’d need to fund the rest through savings and/or releasing equity from your current home with a let to buy mortgage.Maybe one of the mortgage brokers who regularly post on the forum would have more insight but to me it seems like a lot of debt service on a not very high income.1 -
On the LTB, I'd expect a max mortgage of c£135k based on £180k value, a five year fix and £900pm rent.
On the purchase, an income of £26k will get you £110k to £115k over 25 years assuming no debt, dependents etc from a lender who will ignore the let as it will be considered self-financing.
That gives you in the region of £245k to play around with for your onward purchase. Don't forget fees and SDLT or equivalent surcharge on top of usual tax.
I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.2 -
Typically, a 25% deposit is required for the second property.0
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Thanks for so many quick replies.
I had never even heard of LTB before this morning and I'm in work so not able to do much research on the subject and it was only that a web search came up with a link to a thread here that I thought I'd ask.
Essentially I was considering doing the normal thing of just selling up and buying a new home but the idea of keeping this one (which has good future potential) using it to help find another house seems appealing.
Poe0 -
Do you really want to be a landlord? Do you know what's involved?Not sure where you are (England? Scotland?) but reading this is a start
Post 7: New landlords (1):advice & information :see links in next post
Post 8: New landlords (2): Essential links for further information
Post 9: Letting agents: how should a landlord select or sack?
2
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