6Nov2018

Be Prepared When Applying for a Buy-to-Let Mortgage

If you are considering a buy-to-let mortgage there are a few things that you need to consider. A traditional residential mortgage is taken over an average period of between 25-30 years. In these cases, the salary (or salaries) of the applicants will be taken into account.

For a buy-to-let mortgage there are a few things to understand before applying:

The first thing is to understand that you will most likely require a larger deposit than you would for a residential mortgage. Buy-to-let mortgage applications run through stricter criteria and require a bigger financial commitment up front.

Be thorough with your rental forecasts and business plan for the property. Your personal income will be taken into account when applying for the mortgage, but you should also have a thorough forecast in place for expected future rental income.

Choose wisely between traditional mortgage repayments and interest only payments. It will take you longer to pay back a mortgage with interest only payments, but there are tax benefits and lower monthly payments, which are enticing at the early stages of owning a property.

Whatever you choose to do, be prepared for periods where your property is vacant. Void periods happen to every property at certain times, and you need to have a plan in place to cover for those periods and be able to make mortgage repayments.

A buy-to-let mortgage is a perfect opportunity to build a property portfolio. Call us at Central Mortgages on 01277 630 183 to find out how we can help you get started.

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