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  • FIRST POST
    • Brodiebobs
    • By Brodiebobs 9th Sep 11, 2:22 PM
    • 863Posts
    • 3,452Thanks
    Brodiebobs
    buy to let minimum income?
    • #1
    • 9th Sep 11, 2:22 PM
    buy to let minimum income? 9th Sep 11 at 2:22 PM
    hi guys.

    After a bit of advice please, we have seen a couple of properties we would like to buy to rent out.

    For the price range we've been looking at we have a 20% deposit could stretch to 25% if needed.

    The issue comes with mortgages, after approaching my current lender for our residential mortgage after discussing they were happy to lend to us looking at the values, then came across the stumbling block of our income. I work part time, so our joint income is just a couple of hundred below 25k, their minimum income for buy to let, we do also get tax credits but they wouldnt take this into account, to push us over the threshold.

    After looking online quite alot of lenders have this minimum income of 25k or above in some cases..... is there any way round this?
    Addicted to MSE.
    Overpaying mortgage for a better debt free life!
Page 1
  • holly hobby
    • #2
    • 9th Sep 11, 3:20 PM
    • #2
    • 9th Sep 11, 3:20 PM
    Ipswich BS - don't have a minimum income requriement (but you must have income)

    Max LTV 75%

    Fees are a bit hefty ... but horses for courses !!

    Accept direct business and lend throughout Eng & Wales

    Link to assist ... http://www.ibs.co.uk/images/documents/Mortgage/Specialist_Mortgage_Rate_Guide.pdf

    Hope this helps

    Holly
    • Brodiebobs
    • By Brodiebobs 9th Sep 11, 3:25 PM
    • 863 Posts
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    Brodiebobs
    • #3
    • 9th Sep 11, 3:25 PM
    • #3
    • 9th Sep 11, 3:25 PM
    Thanks holly, i'll take a look.

    As i said in the first post, we do have income of over 24k, but everywhere we looked the minimum income was 25k!
    Addicted to MSE.
    Overpaying mortgage for a better debt free life!
    • Thrugelmir
    • By Thrugelmir 9th Sep 11, 3:36 PM
    • 64,960 Posts
    • 57,285 Thanks
    Thrugelmir
    • #4
    • 9th Sep 11, 3:36 PM
    • #4
    • 9th Sep 11, 3:36 PM
    As i said in the first post, we do have income of over 24k, but everywhere we looked the minimum income was 25k!
    Originally posted by Brodiebobs
    The requirement for income of 25k is a bare minimum. So does not mean that you would qualify if you did earn this level of income jointly.
    If the financial system has a defect, it is that it reflects and magnifies what we human beings are like. Money amplifies our tendency to overreact, to swing from exuberance when things are going well to deep depression when they go wrong. Booms and busts are products, at root, of our emotional volatility.
    ― Niall Ferguson
  • holly hobby
    • #5
    • 9th Sep 11, 3:40 PM
    • #5
    • 9th Sep 11, 3:40 PM
    Yes that's correct - 25k min inc is a general/standard marketwide BTL criteria requirement ( unless you are a protfolio landlord).

    A broker will be able to give any alternatives to Ips BS re your income & BTL criteria.

    Hope this helps

    Holly
    • Brodiebobs
    • By Brodiebobs 9th Sep 11, 3:45 PM
    • 863 Posts
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    Brodiebobs
    • #6
    • 9th Sep 11, 3:45 PM
    • #6
    • 9th Sep 11, 3:45 PM
    thanks guys, just seems like alot as where we are the mortgage wont be for much more than our joint income, and the rental income will be about 200% the monthly mortgage payment, we've investigated the market for about 2 years, like everyone here seems to advise now its come as a bit of a shock we will struggle to get a mortgage!
    Addicted to MSE.
    Overpaying mortgage for a better debt free life!
    • Thrugelmir
    • By Thrugelmir 9th Sep 11, 3:51 PM
    • 64,960 Posts
    • 57,285 Thanks
    Thrugelmir
    • #7
    • 9th Sep 11, 3:51 PM
    • #7
    • 9th Sep 11, 3:51 PM
    the rental income will be about 200% the monthly mortgage payment,
    Originally posted by Brodiebobs
    Seems an exceptionally good return. So what's the catch?
    If the financial system has a defect, it is that it reflects and magnifies what we human beings are like. Money amplifies our tendency to overreact, to swing from exuberance when things are going well to deep depression when they go wrong. Booms and busts are products, at root, of our emotional volatility.
    ― Niall Ferguson
  • holly hobby
    • #8
    • 9th Sep 11, 3:51 PM
    • #8
    • 9th Sep 11, 3:51 PM
    You have to understand that a BTL mortgage is in essence a semi-commercial mortgage - and as such subject to different criteria and risk exposure to the lender, hence the min income requirement of most lenders in the market.

    Hope this helps

    Holly
    • Brodiebobs
    • By Brodiebobs 9th Sep 11, 3:58 PM
    • 863 Posts
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    Brodiebobs
    • #9
    • 9th Sep 11, 3:58 PM
    • #9
    • 9th Sep 11, 3:58 PM
    Seems an exceptionally good return. So what's the catch?
    Originally posted by Thrugelmir

    We cant see one really, slow selling market here, some exceptionally cheap houses and a really strong rental market. The street were looking to buy on has 2 rented houses who are on with an agent we are good friends with, neither has been empty for longer than a month in the 5 years he's had them on his books, both now have long term tennats who've been in more than a year.

    Most of the ones we looked at are residential repo's so slightly below 'normal' market prices.

    We werent taking this lightly and are looking in areas we personally know, not just because of the price, and have researched it loads and had a conversation with the bank who went over our figures 6 months ago and were more than happy to lend, then when we wanted to get something in writing they mentioned the minimum income that we'd never been aware of before!!
    Addicted to MSE.
    Overpaying mortgage for a better debt free life!
    • koexelek
    • By koexelek 9th Sep 11, 4:18 PM
    • 7,648 Posts
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    koexelek
    The Mortgage Business ( part of Nationwide) do not have a minimum income requirement either.
    I am a Mortgage adviser
    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.
    • Brodiebobs
    • By Brodiebobs 9th Sep 11, 4:35 PM
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    Brodiebobs
    The Mortgage Business ( part of Nationwide) do not have a minimum income requirement either.
    Originally posted by koexelek

    just googled these and only has existing customers and that they are not accepting new applications?
    Addicted to MSE.
    Overpaying mortgage for a better debt free life!
    • angelsmomma
    • By angelsmomma 9th Sep 11, 4:37 PM
    • 1,163 Posts
    • 1,617 Thanks
    angelsmomma
    I have just got a mortgage through a broker with a much smaller income and my tax credits were taken into account. The fees were hefty but it went through no problem. The rental income on this was also 200% of the mortgage payment.
    Life is not the way its supposed to be. Its the way it is. The way you cope with it is what makes the difference.
    • payless
    • By payless 9th Sep 11, 4:38 PM
    • 6,604 Posts
    • 2,357 Thanks
    payless
    Assume K means The Mortgage Works
    Any posts on here are for information and discussion purposes only and shouldn't be seen as (financial) advice.
    • Brodiebobs
    • By Brodiebobs 9th Sep 11, 4:40 PM
    • 863 Posts
    • 3,452 Thanks
    Brodiebobs
    Assume K means The Mortgage Works
    Originally posted by payless

    ah thanks actually heard of them, looks like i'll be better off going to a broker.
    Addicted to MSE.
    Overpaying mortgage for a better debt free life!
    • Thrugelmir
    • By Thrugelmir 9th Sep 11, 4:44 PM
    • 64,960 Posts
    • 57,285 Thanks
    Thrugelmir
    We cant see one really, slow selling market here, some exceptionally cheap houses and a really strong rental market.
    Originally posted by Brodiebobs
    Then you have to ask yourself why people would pay twice the mortgage cost to rent.
    If the financial system has a defect, it is that it reflects and magnifies what we human beings are like. Money amplifies our tendency to overreact, to swing from exuberance when things are going well to deep depression when they go wrong. Booms and busts are products, at root, of our emotional volatility.
    ― Niall Ferguson
    • Brodiebobs
    • By Brodiebobs 9th Sep 11, 4:49 PM
    • 863 Posts
    • 3,452 Thanks
    Brodiebobs
    Then you have to ask yourself why people would pay twice the mortgage cost to rent.
    Originally posted by Thrugelmir
    Because theres high unemployment/low wages/high deposits needed so people cant get mortgages?

    I'm not fussy about renting to DSS as i know its inevitable where we live and the market were looking at in that area, we also kind of have a couple of people in the low wage/no deposit bracket who want to let if we get somewhere. And i know they downside of this but the property will be more than likely through an agency, with as many checks as needed to be done, and we have a contingency fund if the worst was to happen.

    Like i said we've thought it through and can evidence rents in the area, for clarification the mortgage would only be around 30k (if not less) so double the mortgage payment will be around 400 a month rent so not excessively expensive.
    Last edited by Brodiebobs; 09-09-2011 at 4:52 PM.
    Addicted to MSE.
    Overpaying mortgage for a better debt free life!
    • Thrugelmir
    • By Thrugelmir 9th Sep 11, 5:27 PM
    • 64,960 Posts
    • 57,285 Thanks
    Thrugelmir
    Because theres high unemployment/low wages/high deposits needed so people cant get mortgages?
    Originally posted by Brodiebobs
    Then I would take the view that property prices are to high in the medium term. The mortgage market is reverting back an to era pre credit boom.
    If the financial system has a defect, it is that it reflects and magnifies what we human beings are like. Money amplifies our tendency to overreact, to swing from exuberance when things are going well to deep depression when they go wrong. Booms and busts are products, at root, of our emotional volatility.
    ― Niall Ferguson
    • Brodiebobs
    • By Brodiebobs 9th Sep 11, 6:57 PM
    • 863 Posts
    • 3,452 Thanks
    Brodiebobs
    Then I would take the view that property prices are to high in the medium term. The mortgage market is reverting back an to era pre credit boom.
    Originally posted by Thrugelmir
    this house is in an area we lived we paid 65,000 for a similar house in 2003, its on for 40,000... TBH i dont think they can get much lower, and at that price, with our deposit and almost guarenteed rental im prepared to take the risk.

    I understand your entitled to your opinion.
    Addicted to MSE.
    Overpaying mortgage for a better debt free life!
    • GMS
    • By GMS 9th Sep 11, 7:03 PM
    • 5,354 Posts
    • 2,774 Thanks
    GMS
    this house is in an area we lived we paid 65,000 for a similar house in 2003, its on for 40,000... TBH i dont think they can get much lower, and at that price, with our deposit and almost guarenteed rental im prepared to take the risk.

    I understand your entitled to your opinion.
    Originally posted by Brodiebobs
    You will not get a Buy to Let mortgage with The Mortgage Works on a 40k property. Below their minimum valuation.
    I am a Mortgage Adviser
    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.
  • holly hobby
    The Mortgage Business ( part of Nationwide) do not have a minimum income requirement either.
    Originally posted by koexelek
    As stated would guess, that Koexelek actually means The Mortgage Works (link re TMW BTL criteria for your info - http://www.themortgageworks.co.uk/content/lendingcriteria/#btl )

    As The Mortgage Business (TMB) even when active, were not and never part of Nationwide BS -their specallist/niche lending arm was UCB.

    TMB were a specialist lender of BOS, and became part of the HBOS group - although they retained their base in Chester.

    Hope this helps

    Holly
    Last edited by holly hobby; 09-09-2011 at 9:39 PM.
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