Is there a buy to let mortgage age limit?

There are several criteria commonly used by lenders when considering an application for a buy to let (BTL) mortgage. Although how these criteria are applied might vary from time to time and from one mortgage lender to another, the following are typical factors:

you need to be interested in investing in residential property; you understand and accept the risks of such investments; your financial circumstances mean you can afford to take those risks; you have a sound credit record – and, preferably, own your own home; and until very recently, at least, you have to have been no older than 70 to 75 years of age when the mortgage came to its full term. So, for example,  a 25-year buy to let mortgage taken out by someone as young as 45 would not end until they reached the age of 70. Is there still a BTL mortgage age limit?

In recent years, mortgage lenders generally seem to have adopted a far more relaxed attitude towards those upper age limits. Read more

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Can I get a BTL mortgage with a tenant in situ?

If a property you want to buy to let already has tenants in situ, at first sight, it might seem to answer several significant issues:

you might have picked up a bargain property since those with sitting tenants are likely to have had thousands of pounds knocked off the asking price, according to an article in Property Investments UK on the 14th of March 2020; you won’t need to spend any time advertising and selecting tenants, because they are already in place; the property comes with sitting tenants, so you get to receive rent from day one; if you have bought the property with tenants in situ, the seller has probably also left it furnished, so that is one less problem you need to worry about; and there is unlikely to be any need for the urgent or immediate refurbishment of the property because the tenants in situ decided to stay put despite the change of ownership and landlords. The problem

The one problem you are likely to encounter, however, is…

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Can I get a buy to let mortgage as a first-time buyer?

Investing in buy to let property makes a great deal of sense, said the British Landlord Association (BLA) in an article on the 18th of May 2020 – while at the same time also warning that it is by no means a route to getting rich quick.

Being a landlord is no walk in the park, insists the BLA, and it is likely to come with its moments of stress, hard work and, above all, good judgment in your investment decisions. A lot of the qualities it is going to take might require a mature head and at least a little experience of the property market in general.

The question arises, therefore, whether you are likely to be cut out for the role of a landlord if you are a first-time buyer – and, more critically perhaps, whether you are even likely to get a mortgage as such an investor.

Although a buy to let (BTL) mortgage for a first-time buyer is perfectly feasible, it is likely to be a more challenging process than for those who have proven experience in the…

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Do buy to let mortgages with no proof of income exist?

Buy to let mortgages are advanced on the strength of the business case made by the prospective landlord – will there be sufficient rental income generated to at least cover the need to maintain the mortgage repayments and meet the operating expenses of the buy to let business?

That reliance on the buy to let business model leads to two further fundamental differences between a buy to let (BTL) mortgage and an owner-occupier’s mortgage for the home they live in:

because they are essentially business transactions, buy to let mortgages are not regulated by the Financial Conduct Authority (FCA), explains the Council of Mortgage Lenders (CML); and affordability – your ability to maintain the mortgage repayments is mainly measured with reference to the lettings business (with any other income you receive used to support your mortgage application).

Both factors may help to make lenders attitudes towards establishing proof of income more flexible when you …

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Are there buy to let mortgages based on rent only?

If you are wondering whether rental income can be used to qualify for a buy to let (BTL) mortgage in the UK, then the answer is “yes” – though finding a lender willing to do so may sometimes prove a challenge.

Buy to let mortgages are granted based on the business case made by the applicant – and that business case rests on the rental yield that is projected to be realised once the mortgaged property is let.

If you are in search of buy to let mortgages based on rent only, success is likely to depend on the level of rental yield projected and the certainty with which that projection might be met.

Rental yields

Most buy to let mortgage lenders look for evidence that your let property will yield a rental income that is at least 125% of your monthly mortgage repayments – in some cases, they may be looking for a rental income of at least 145%, explains the website Money Facts.

In making that calculation, most lenders use a representativ…

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Can I get an adverse credit buy to let (BTL) mortgage?

An adverse credit buy to let (BTL) mortgage is just what it says – a buy to let mortgage for someone who has an adverse credit history. Can you get one? Yes, you can – though you might have to look a bit harder than normal.

Mortgages and your credit history

When you apply for any kind of mortgage – including a BTL mortgage – one of the principal investigations any lender will make is about your credit history. Your credit history indicates how you have managed debt in the past, whether you have made repayments on time, or if you have missed some altogether – all as a way of trying to determine whether you are likely to repay the mortgage loan for which you are now applying.

If you have defaulted on the repayment of past debts or credit, had to make individual voluntary arrangements (IVAs) with creditors, received county court judgments (CCJs) against you, or ever declared bankruptcy, you will be given a low credit score. A low credit score means it is…

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What are let to buy mortgages?

If you have owned your existing home for a while, naturally, you are likely to have grown fond of it. More often than not, its value has increased in line with the overall increase in house prices. As you have been paying off your mortgage, so your equity in your current property is also likely to have increased.

So, a home that you have grown to love and one that has increased in value may be one that you want to hold on to as a long term investment if you decide to move home. Not only that, but it might also give you the chance to release some of the equity in your current home to buy the new, second property.

How does a let to buy mortgage work?

Let to buy mortgages offer you the opportunity of doing precisely that. As the term suggests, this type of mortgage is based on your letting your current home.  So, its value continues to work hard for you through the income stream from rents, and you also release some of the equity you own in that hom…

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Can I get a mortgage to buy a holiday home?

It matters to a mortgage lender how you intend to use the property you are buying.

If the property is to be your main home, for instance, the lender will line up a residential mortgage for you as the owner-occupier and assess the affordability of the loan in terms of your income, job, outgoings, credit history, and so on.

If you are buying a property to let to paying guests, on the other hand, it is an entirely different ballgame as far as the mortgage lender is concerned. The lender is now interested in the business proposition of your buy to let plans, principally based on the rental income the property is likely to generate.

A holiday let mortgage appears to be a hybrid between these two. For part of the year, your holiday home might be used by you and your family as the owners of the property; at other times, it may be let to short-term tenants and holidaymakers.

According to figures released by the Ministry of Housing, Communitie…

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How to remortgage a buy to let property

If you own buy to let property, and even if it remains subject to a mortgage, you almost certainly have equity tied up in your investment.

There may come a time when you want to unlock a proportion of that equity – to improve your let property, for example, or to expand your investment portfolio. One of the readily accessible ways of releasing equity from a buy to let property is to secure a remortgage.

What is a remortgage?

A remortgage is very simply a new mortgage taken out on a property you already own. The remortgage serves either to replace a mortgage that currently exists on the property or represents a way of borrowing against the property.

As the Money Saving Expert points out in an article last updated on the 4th of February 2020, approximately one-third of all loans on residential property in the UK are remortgages.

You may remortgage a buy to let property in the same way as you may remortgage the home you live in – alth…

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SIC Codes for SPV Buy to Let Mortgages

What are SIC codes?

Limited companies need to be registered at Companies House. When registering a limited company the person who registers the company can choose one or more SIC codes. SIC stands for Standard Industrial Classication. There are hundreds of different codes covering all types of industries and services. This short post will explain which SIC codes are recommended for registered an SPV for a BTL limited company.

Different lenders ask for different SIC codes than each other. However generally as long as you have atleast one of the SIC codes as per below then most mortgage lenders should be OK.

The SIC codes suggested:

68100 – BUYING AND SELLING OF OWN REAL ESTATE68209 – OTHER LETTING AND OPERATING OF OWN OR LEASED REAL ESTATE68201 – RENTING AND OPERATING OF HOUSING ASSOCIATION REAL ESTATE68320 – MANAGEMENT OF REAL ESTATE

Generally as long as you have the above SIC codes registered for your S…

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