Finding the Best Buy to Let Mortgage Providers
In recent years, lenders have recognised that many people wish to invest in property intended for the letting market. Some have devised products specifically tailored to would-be landlords (called 'buy-to-let' schemes). The concept was originally promoted by ARLA (the Association of Residential Letting Agents) whose members reported a gap in the availability of mortgages for their client landlords. Buy to let packages, varying in nature, can now be obtained from many high-street lenders, including most banks and building societies.
The advantages include:
- The letting income generated by the property forms part of the decision-making calculation by the lender for granting an advance.
- Lenders are usually prepared to consider granting a mortgage, even though the applicant may already have one running on their own home.
- Those who are self-employed (or intending to be full-time landlords) and those otherwise unemployed are not usually obstructed from making an application.
The disadvantages include:
- Lenders usually require a significant amount of information about the property and forecasted data on the anticipated rental income.
- It may be compulsory to accept various insurance policies from the lender.
- The tenancy agreement must be drawn up by a solicitor or through a recognised agency.
- It is often mandatory to employ a letting agent approved by the lender to oversee the creation and management of the tenancy.
For more details about buy to let, visit ARLA's website on the subject: www.buytolet.co.uk. Alternatively, consult any high-street bank for details of their package and shop around because schemes vary from one lender to another.
