Struggling to find the best buy-to-let mortgage in Billericay? speak to one of our buy to let mortgage advisers today
The term ‘buy to let‘ generally refers to either the practice of buying a property to be let for profit or to the type of mortgages used to purchase a property for such letting. Many countries, both in the western world and in the developing nations, have seen a surge in the growth of the buy to let property market in the last 2 decades and this has fuelled a growth in amateur landlords and the but to let mortgage providers who are keen to encourage and profit from them in turn. In addition, this growth has generated a lot of commerce in other related sectors such as buy to let insurance.
What Are Professional Buy To Lets? | Property Investments UK
Many countries, both in the western world and in the developing nations, have seen a surge in the growth of the buy to let property market in Billericay the last 2 decades and this has fuelled a growth in amateur landlords looking for quality mortgage advice, this is why mortgage brokers in Billericay who specialise in Buy-to-let are so important and the but to let mortgage providers who are keen to encourage and profit from them in turn. In addition, this growth has generated a lot of commerce in other related sectors such as buy to let insurance.
Billericay Buy to let mortgages have been available in the UK since the mid-nineties and they are specifically designed for investors to borrow money to purchase property in the private rental sector. The amount that a prospective but to let investor can borrow is generally determined by the rental valuation of the property. The annual income for a rented property has to cover a certain percentage of the mortgage repayments, the Association of Residential Letting Agents (ARLA) states that landlords should seek to be able to obtain gross rent returns equivalent to between 130 per cent and 150 per cent of the rental property’s mortgage repayments, this takes into account the surplus rent to cover costs of property maintenance and slack periods when the property may be vacant of tenants.
Billericay Buy To Let Mortgages.
Some buy to let mortgage lenders in Billericay will lend you a maximum sum based on a multiple of your salary (usually a multiple of three) plus a percentage of the forecast rental income on the property. So if your annual salary is said 30,000 Franks and the forecast rental income is 10,000 Franks they will lend you 95,000 Franks. Other mortgages, in addition to factoring in your salary, will include any existing loan commitments you have, and then apply what is known as the ‘deduction rule’. This rule relates to the annual mortgage payments worked out at a pre-set level of interest.
Buy to let mortgage interest rates are generally fairly close to residential mortgage rates but will generally be slightly higher and typically charge higher fees. This is due to the fact that buy to let loans are considered by the financial sector to represent a greater risk than residential owner-occupier mortgages, and they generally are.
The Situation in the UK About Buy To Lets
The buy to let market literally ‘exploded’ in the Billericay around the beginning of the millennium with rising property prices and the increasing availability of buy to let funding fueling a surge in would-be investors trying to cash in on the trend of the market. One reason for their popularity is the tax advantages that are available to the UK buy to let investors. Rental income is treated just like a salary by the Inland Revenue, and is therefore often taxed at 22% or even 40%. However, landlords are allowed to deduct costs from the taxable portion of their rental income, and these costs can include the interest of the buy to let mortgage repayments as well as maintenance costs on the property. These tax incentives made the buy to let market very attractive for both professional investors and amateurs looking to make the most out of their savings.
Would-Be Buy-to-let Investors
The market peaked around 2007 and now the market is saturated in many areas across the country with too many properties available to tenants. While buy to let is generally not a good idea for people who do not possess some extra budget there are a lot of remortgage deals which will fund a deposit for a home. If you are worried about losing money during void periods many companies will provide insurance which can deliver as much as six months mortgage payments in the event of a property in Billericay remaining unoccupied.
You may still be lucky, and find a hotspot but you need to do your homework and the figures correctly. Buy to let trends differ from town to town and literally from street to street. Good advice for potential investors is to visit the local letting agents who should be able to tell you who is renting what at the moment so you can define your target audience. It could be students, young professionals or families, for example. Look for areas that do have a shortage of properties and for indicators that people will move there, such as new business developments.
Buy to let mortgage deals are still rife and the rates are almost as competitive as with conventional deals. The mantra with your buy-to-let must be ‘don’t expect to get rich quickly’. You need to look long-term: an absolute minimum of five years – but probably nearer to ten years.
hi there this is Emma from Martin & Co Estate agents here I've got my midweek buy-to-let deal of the day for you to have a little look at so the one I picked up with you today is a two-bedroom modern apartment on duty around in chelmsford now this one is modern.
Goodier Road is a very good location in Chelmsford you're walking distance to Centre, train station and all the shops that Chelmsford has an offer and the property is in very good condition quite neutral decor which is good and allocated parking as well which is by most especially being this close to the city centre where parking is always a premium and so we know this property is a good-looking property, it takes a lot of boxes on that front just come on the market with property street and it has an asking price of £249995 so price-wise it's pretty competitive with similarities in the area and and if we have a look at rental potential now and potentially you're going to be looking around about the 900 pounds a month mark.
We rented one very similar to this in the area, maybe this individual block for £900 and so that's a pretty good indication of an accurate figure for you.
Now we do a little yield calculation and the £900 rent against our asking price of 249995 and that could potentially generate you an annual return 4.
3 percent so it's a pretty good return also of course that isn't taking into account the service charges or ground rent but of course you know we All in all the figures do seem to stack up if this property is of interest to you better get in touch with the agent who is advertising it, Property Street to book yourself a viewing because properties are flying off the shelves like hot cakes at the moment so you don't be missing out thanks for checking in and I'll speak to you all in a couple days with my next buy to let deal of the day.
FAQs on Ltd Co borrowing for buy to let
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When you are thinking about buying an investmentproperty, the mortgage is one of the most important considerations.
If you would liketo know my recommended method for finding the best mortgage for your property investment,then stay tuned as I explain how.
Hello, I’m Andy Walker from monoperty.
Com,where I blog online about my journey as a property investor and landlord, sharing whatworks for me and what doesn’t, to help you start or expand your property portfolio.
Now, there are plenty of banks and mortgagelenders out there who all have hundreds of mortgage products offering different interestrates, terms and fees, resulting in thousands of mortgages for you to choose from.
When I first started, I looked at online comparisontools to find the cheapest product which I thought would match my needs.
After hoursof research, comparing interest rates and application fees, I then discovered that eachproduct has it’s own requirements and eligibility criteria once you start the application process.
These included the household income, whether I had any other investment properties anda whole host of other factors.
It wasn’t easy and it took a lot of time.
So to save you time, here is what I recommend.
Find a mortgage broker.
Simple you might be thinking, but no, hold on, don’t pick upthe phone just yet.
I wouldn’t recommend any mortgage broker, I’d recommend you finda broker with these 2 qualities: Firstly, someone who specialises in Buy ToLet products and not residential or a mixture of both.
Why? Because as I’ve already mentioned,it’s a huge market out there and only the brokers that deal specifically deal with BTL productswill have the best knowledge.
They have direct contact with the lenders and have vast amountsof experience with their lenders eligibility criteria.
Within a few minutes of asking yousome key questions, a broker will be able to match you to suitable lenders, and withinjust a few days, they will be able to provide you with some mortgage products for you tochoose from.
You also want to find a broker who’s aninvestor themselves because they’ll have a better understanding of your plan and whatyou are trying to achieve.
I’ve used 3 brokers in the last couple of years, 1 wasn’t aninvestor and 2 were.
The service I received form the 2 that were investors, was far betterthan the one who wasn’t, and not only did they provide me with a product that best suitedmy needs, but they also shared some sound investment advice about the properties thatI was buying.
A mortgage broker will receive a commissionfrom the lender for selling you their product and the broker may also charge you a fee.
But don’t let this put you off because mortgage brokers work hard, and they check all thepaperwork to avoid any delays with the application.
All correspondence between you and your brokercan be sent via email, which makes it super convenient to find a broker anywhere in thecountry.
My broker fees are paid once the lender has released their funds and the propertyis in my name.
I know there some brokers charge a fee upfront, but that has always put meoff, and I haven’t used them.
So how do you find a broker with these qualities?Well, there are several ways and they are typically places where investors are found;Property Auctions, Property Network Meetings, and Social Media Platforms.
Facebook groupsare good for connecting with the right people who have backing from some of the group members.
I hope you found this video useful and ifyou have any recommendations on how to find a good mortgage broker, then please leavea comment in the box below or head over to monoperty.
Please like and sharethis video, and if you are visiting for the first time, please subscribe so you don’tmiss any of my future videos that are all be geared towards helping you start or expandyour property business.
Thank you for watching, keep up the good work, and I’ll see youin the next one.
Bye for now!.