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A buy-to-let mortgage is a mortgage for a property you’re renting to someone else – as opposed to a residential mortgage, which is meant for a property you’ll be living in yourself. If you’ll be letting out the property you’re purchasing, lenders will almost always require your mortgage to be a buy-to-let mortgage. As a buy-to-let mortgage is seen as a business investment, they also have higher interest rates and usually require higher deposits than residential mortgages.
If you own and rent out HMOs our specialist advisors can do all the leg work for you to help you secure the best deal. We'll work with a wide range of lenders to find the mortgage that suits your needs.
Since the phasing out of tax relief for mortgages back in 2016, buy-to-let investors have seen their earnings decrease. And, in an effort to maximise their investment, they began exploring alternative options. This has mostly led to SPV (Special Purpose Vehicle), otherwise known as a limited company (ltd). The idea behind SPV sees investors buying a property as a company rather than an individual, in an effort to be more tax efficient. There are advantages and disadvantages to both based on your earnings.
As with all 2nd properties, there will be an increased stamp duty by 3% of the total purchase price. So don't forget to include this in your calculations when looking to purchase a buy to let property.
If you in a position where you are a first time buyer and considering purchasing a buy to let as your first property we'd always advise caution. Many of the incentives such as reduced stamp duty for first time buyers and lifetime ISA/ help to buy ISA wouldn't be able to be used in conjunction with a rental property and wouldn't then be available to use when purchasing your own home.
Part of the after effects of Covid-19 still being felt is the boom in "staycations" As a result, this has also increased demand for holiday let property. If your considering an additional property as a holiday let or refinancing existing properties contact to find out how we can help you.
Services that might benefit you....
Gloucester Mortgage Centre are authorised and regulated by the Financial Conduct Authority, FCA registered (http://www.fca.org.uk/register) under reference 300783.
The Financial Conduct Authority does not regulate Buy to Let Mortgages.
Gloucester Mortgage Centre may charge a fee for arranging your mortgage. Typically £495, the actual fee will depend on your circumstances.
Your home may be repossessed if you do not keep up with the repayments on your mortgage.
Information contained within this website is subject to UK regulatory regime and is therefore targeted at UK consumers.
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