When looking to invest in buy-to-let property, one may wonder how a Best Buy To Let Mortgage Broker can help this. This article covers the basics, from what a buy-to-let mortgage is to the benefits of using a Buy To Let Mortgage Broker. The bottom line is, that it’s worth consulting a mortgage broker when considering this type of property investment.
What Is A Buy To Let Mortgage?
A buy-to-let mortgage is a loan that a person obtains to purchase a property and let it out. This type of loan generally has higher interest rates and requires a larger deposit. A buy-to-let mortgage for investment purposes is not usually regulated by the Financial Conduct Authority, but buy-to-let mortgages for residents are. Here are the benefits and disadvantages of this type of mortgage.
Most buy-to-let mortgages are interest-only, meaning that the borrower only repays the interest. This is a great option for those looking to keep their properties as rental properties. However, keep in mind that these mortgages require a higher deposit than a residential mortgage. The buyer will typically need a minimum deposit of 25% of the total value of the property. Other fees may be higher as well. Arrangement fees may cost up to 3% of the property’s value.
The amount one can borrow through a buy-to-let mortgage will depend on the value and type of rental property that one intends to rent. Lenders will look at the rental income as well as the personal income to determine how much can be borrowed. A first-time landlord may need to have a separate income.
How Can A Buy To Let Mortgage Broker Help?
A Best Buy To Let Mortgage Broker will be able to guide the borrower through the process, from applying to finding the right mortgage to getting the best deal. These brokers have access to the entire market, so they can help to secure the best deal. The broker’s fees will vary, depending on the type of deal and complexity. The following are some tips to help find the right mortgage for the loan needs.
Using a Best Buy To Let Mortgage Broker can save time, stress and money. But one will need to choose the right broker for the needs and level of expertise. While the FCA is responsible for regulating the buy-to-let mortgage market, not all brokers are experts in the sector. So, it is important to find a broker who has a lot of experience in the market.
While it is important to check the credit report, the mortgage provider may not give the best deal due to bad credit. This means that the terms and products may be different from those of people with better credit. One may need to make a larger deposit or be offered lower interest rates. A Best Buy To Let Mortgage Broker will discuss the options and be able to point the borrower in the right direction. If the credit history is poor, a mortgage broker will be able to point in the right direction and find the best option.
It is important to remember that a buy-to-let mortgage is very similar to a residential mortgage application, but is largely about investing wisely. It is crucial to do some research to determine how much the price of houses in the area is increasing, as this won’t harm the mortgage. Remember that the best investment is a combination of capital growth and rental yields.