Buy to let mortgage
Our buy to let mortgage range covers portfolio investors or first time landlords. We’re working with UK based landlords, UK ex-pats and foreign investors.
Whatever your property investment needs, your Acorn.finance advisor will get you the right buy to let mortgage.
What is a buy to let mortgage?
A buy to let mortgage – or residential investment mortgage is a specific type of business mortgage where the security is residential property and the mortgage interest payments are covered by the rent income from the property tenant(s).
There is a wide variety of buy to let mortgage available, catering for new investors taking their first steps through to seasoned investors growing their portfolios.
Many borrowers use an interest only strategy to maximise their available cash flow, so you are left with the capital owing at the end of the loan period. If you’d prefer a capital and interest repayment discuss with your advisor and we’ll arrange your buy to let mortgage to suit.
How do we get the best buy to let mortgage rates?
Our whole of market panel includes every lender operating in the UK buy to let mortgage marketplace. We’re not algorithms or robots, we’re real people. Your advisor will take the time to understand your current position and, importantly, where you want to be – they will do that before making any recommendations. We call it FUNDED, our six step system to getting you the right advice, every time.
Buy to let mortgage frequently asked questions
Your buy to let mortgage will normally be covered by the rent on the property so for most lenders the calculations are based purely on that basis, with normally 125% or 140% cover over the payments, depending on your tax position.
Some lenders look at your income in a general sense, expecting income to be over a minimum level, but that’s not the whole market. For most applicants there’s a lender to fit their circumstances.
Whilst it’s not illegal, letting a house without the permission of the lender falls outside their terms of business and as such is mortgage fraud (remember Peter Mandelson?). Committing mortgage fraud is serious and could result in you losing your properties and being unable to raise finance in future if you are placed on the fraud blacklist. It probably won’t give you a fast-track to the House of Lords!
Buy to let mortgage products can go up to 85% of the property value currently so you’ll need a 15% deposit. The actual amount is dependant on the rental income from the property so the highest loan to value loans are not available on every property so speak to an advisor before you bid on the property.
You’ll also be liable for Stamp Duty Land Tax (or Land and Buildings Tax in Scotland) which has surcharges for properties which are not your main residence and for investors domiciled outside the UK, so check your rates with the appropriate tax authorities.
Other fees you might be liable for would include valuation fees, lending arrangement fees and solicitors fees.
A buy to let mortgage is for investors who do not intend to live in the property. So, no – you cannot take a normal buy to let mortgage if you’re intending to live in the property.
There are special mortgages for those letting part of a property out, such as students, or if you would like to use the property some of the time a holiday let mortgage might be more appropriate.