Buy-to-let mortgages

Buy-to-let mortgages are for investment properties.

They are available with the same rate types as for residential mortgages as described above. The rates, however tend generally to be higher.

The amount that a lender will offer to lend will depend most commonly on the amount of rent that the property will command as assessed by the valuer appointed by the lender. However, there are lenders who, where there is a shortfall in the rental income, will allow this to be made up from regular income, as long a there is a sufficient amount spare after taking into account existing credit commitments.

You will usually have to put down a minimum of 15% deposit although there are one or two schemes that will accept a little less than this.

Each lender has its own formula for working out how much you can borrow so you should consult an adviser who will have each lender’s criteria available.

It is very important to know that not all lenders will lend on all types properties and that the property needs to be in a ‘lettable’ condition for the lender to consider advancing a loan.