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    • buzu
    • By buzu 8th Sep 17, 6:26 PM
    • 3Posts
    • 0Thanks
    Should we buy to rent?
    • #1
    • 8th Sep 17, 6:26 PM
    Should we buy to rent? 8th Sep 17 at 6:26 PM
    Hi All,

    We bought our house 3 years ago for 160K. It's currently valued at around 240K.

    We are thinking of moving for school catchment areas purposes.

    We are wondering how much it would cost us to switch the loan to Buy to rent loan and if they the rent would cover the load + other expenses.

    We have 130K left on our loan.

    Any ideas what the Loan repayments (or % for that matter) would be like?

    Any insight would be greatly appreciated
Page 1
    • kingstreet
    • By kingstreet 8th Sep 17, 7:12 PM
    • 33,682 Posts
    • 18,267 Thanks
    • #2
    • 8th Sep 17, 7:12 PM
    • #2
    • 8th Sep 17, 7:12 PM
    It's practically impossible to answer this.

    The term, interest rate, choice of interest-only or capital & interest, the lender's rental income cover calculation will all have a bearing.

    If you really, really, really, really want to be a landlord get an assessment of the rental income possibilities from an ARLA registered letting agent and make an appointment with a decent independent mortgage broker.

    Will this be a let to buy? Will you want to buy another residence? If so, where is the deposit coming from? What about the extra 3% stamp duty on the purchase?

    A lot to think about and there are landlord tax changes currently underway which will make such a plan less tax efficient.
    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.
    • Cakeguts
    • By Cakeguts 8th Sep 17, 8:30 PM
    • 4,567 Posts
    • 6,584 Thanks
    • #3
    • 8th Sep 17, 8:30 PM
    • #3
    • 8th Sep 17, 8:30 PM
    When letting a property you have to consider if you would be able to continue to pay the mortgage for several months if the tenant stopped paying the rent. If you get a tenant who stops paying the rent it can take several months to evict them. You also have to be able to afford to pay for repairs if you are not getting any rent.

    So work out if you can afford to pay the mortgage and repairs for at least 6 months without getting any rent. If you can't do this then you would be risking your house if you let it.

    I am a landlord and some tenants don't tell the whole truth when they apply to rent a property.
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