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Our Broker's Best Buy To Let Deal

 

Buy To Let Mortgages

Buy to Let mortgages have now been in existence for over 10 years and have evolved quite dramatically over that time. For one there are many more lenders offering mortgage products in this sector and only last year saw the Alliance & Leicester offer Buy to Let mortgages plus some new names including Edeus and Close Mortgages.

With the advent of more lenders the interest rates have become more competitive and now not too dissimilar to residential mortgage rates. You have the option as with residential mortgages of Fixed, Discount, Capped, Tracker and Flexible mortgages and there are even a few lenders offering offset facilities.

In the main a Buy to Let mortgage should be self financing, this means that the lender requires the rental received from the tenant to cover the monthly mortgage payments. The preferred mortgage repayment option by most landlords is an interest only option and unlike the residential sector where lenders look for an investment vehicle behind the mortgage, Buy to Let lenders are happy that the landlord will be selling the property at the end of the mortgage term to pay back the initial amount borrowed.

Rental requirements by the lenders vary and are very often calculated at 125% at pay rate. But with the increased competition there are some lenders that now require no income requirement, (subject to you having had a BTL mortgage for the last 12 months), and other lenders now only needing the rental income to equate to the monthly payment, hence 100% at payrate. If the rental income requirement needed by the lender was still hard to achieve there are a few lenders that will look at each case on an affordability basis so will look at your earnings, the rental due and your existing mortgage commitment. If according to their calculation there is surplus then this can always be the alternative route to a BTL mortgage.

You will need a minimum deposit of 10% to secure a Buy to Let mortgage, but the majority of lenders require 15%, however if you were purchasing a new build property and the builder was able to offer you the builders deposit paid then you could purchase the property with no money down, (if the builder was to offer you a full 15% deposit paid), but with other more competitive lenders if you had a 5% deposit paid incentive then you would only need to fund 5% deposit yourself.

There is no limit to how many Buy to Let properties you own, (you just need the deposits), there are now 1000s of Buy to Let mortgages and Buy to Let remortgages available and AT Grovelawn Financial over 30% of their business is in this market and as such are able to offer semi-exclusive mortgages from leading High Street and specialist lenders and can also offer solutions to No Money Down Buy To Let Mortgages.

 

Buy to Let Mortgage Comparison

 
LenderRateTerm TypeStd RateAPRFeeEarly Repayment ChargesMax Loan to Value
The Mortgage Works5.39%2 year tracker BBR plus 0.39%7.247.503%No early repayment charges70%
B M Solutions5.69%3 year tracker BBR plus 0.69%7.447.502%3% of loan within first 3 years60%
B M Solutions5.89%3 year tracker BBR plus 0.89%7.447.502%3% of loan within first 3 years75%
The Mortgage Works6.29%2 year tracker BBR plus 1.29% until 31-Aug-20107.247.501.25%5% of loan amount for 2 years75%
B M Solutions6.29%3 year tracker BBR plus 1.29%7.447.702%3% of loan within first 3 years85%
Woolwich6.59%1.99% above BBR term of mortgagen/a6.59£2952 Months interest within first 3 Years75%
 

Buy to Let Mortgage Comparison - 90%+

 
LenderRateTerm TypeStd RateAPRFeeEarly Repayment ChargesMax Loan to Value

Buy to Let mortgage price comparison, last updated Thursday, 7th August 2008

Grovelawn Financial Services, Gemini house, Hargreaves Road, Swindon, Wilts, SN25 5AZ — T: 0845 458 2633 — F: 01793 706 533 — E: enquiries.ignore@grovelawnfinancial.remove.co.uk