Buy-to-Let Mortgages

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTAGE.
The mortgage will be secured by a charge on the property of the customer.

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Buy-To-Let Mortgages Are Specifically Designed for People Who Want to Buy A Property and Rent It Out.

Unlike regular mortgages which are based on income and outgoings, the amount loaned by Lenders in Buy-to-Let Mortgages is partly based on the expected rental yield of the property.

Considered to be a higher risk than a regular mortgage, Buy-to-Let Mortgages often come with stricter eligibility criteria from Lenders, from some which refuse to lend to first time buyers to others which place minimum salary requirements. It is important to speak to a professional Mortgage Adviser to understand what mortgage you could access based on your circumstances.

Although in essence, Buy-to-Let Mortgages work in the same way a regular mortgage does, there are a few key differences. Firstly, most Lenders require a 25% deposit of the property price. The interest rates on Buy-to-Let Mortgages are generally higher and most mortgages are offered on an interest-only basis.

MOST BUY-TO-LET MORTGAGES ARE NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY

Stamp Duty Tax – Click here to see how much Stamp Duty you could be liable to pay

Mortgage Valuation Fees - ?These can vary from Lender to Lender and in some cases can be added to the amount borrowed

Conveyancing Costs - This is to cover the legal work on purchasing your new home, factors that can influence cost are things like Shared Ownership.

Landlord’s Insurance - Speak to us for a quotation.

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Tips for New Landlords

Legal Requirements Protect Your
Tenants

Insurance Protect Your
Investments

Tenancy Agreement Outline Your Expectations

Planning for Quiet Periods

Protect Your
Finances

Evidence

When Disputes
Arise

1. Legal Requirements

As A Landlord, Your Tenant�s Health and Safety Is of Utmost Importance.

As a Landlord, there are certain legal requirements that you must adhere to, with your Tenant’s health and safety of utmost importance.

Unless you instruct a Property Management company to look after your property, it’s up to you to organise the necessary checks and keep up-to-date with the changes in the law. Obligations include to fit and test smoke alarms as well as carbon monoxide alarms, ensure gas safety and all electrical items are fit and safely installed.

2. Insurance

Letting Out Your Property to A Tenant Can Be Risky, No Matter How Many Checks You Do

Everyone is human and accidents can happen to the best of us, although letting a property out to a stranger can feel a little riskier than usual. If disaster does strike, having Landlord's Insurance will provide a security blanket that could prove invaluable.

Whether it is the little things or the more serious threats, the level of cover ranges depending on Providers and budget, allowing you to choose a package that is suitable for you. From legal expenses, loss of rent and for accidental or malicious damage, it certainly can help during difficult times.

3. Tenancy Agreement

A Tenancy Agreement Is A Contract Between You and Your Tenant, Outlining the Responsibilities of Both Parties.

Outlining your responsibility as a Landlord and their responsibility as a Tenant, it may not be a legal requirement but a Tenancy Agreement allows clear boundaries and expectations to be set. It has no effect on legal rights but could outline rules such as pet allowance or smoking bans.

An agreement can be made orally, however, it is much safer for both parties to have a signed and dated hard copy to show evidence in the event of a disagreement.

4. Planning for Quiet Periods

It's Important to Protect Your Finances and Plan Well in Advance for Those Dreaded Quiet Periods.

There may be a time when your property is vacant and awaiting its next Tenant to move in, with Buy-to-Let Mortgages based on rental yield, it is important to plan well in advance for the time when you may not be receiving any money.

Whether that is by putting some money aside in a Savings Account or by taking out Unoccupied Property Insurance, make sure you plan, these things have a tendency to pop up when you least expect it!

5. Evidence

Make Sure You Get Everything in Writing, So, If A Dispute Does Arise, You Have All the Evidence You Need.

After spending money on your property to make it perfect for Tenants, the last thing you need are disputes over property or contents damage. Before your Tenant moves in, make an inventory list of everything you have provided, even take pictures of the items in their original condition, get the Tenant to sign their acknowledgement and provide a copy to the Tenant.

Any communication should be documented and phone calls followed up with a summary email. If a dispute does arise, you have all the evidence you need.

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Buy-to-Let Mortgages