Posted on: 08th Jun, 2004 11:29 pm
Buy-To-Let Mortgage is a kind of mortgage loan taken to purchase a property which will be offered as rent to tenants.
Various types of buy to let mortgages:
Features
Various types of buy to let mortgages:
Fixed rate buy to let mortgage.
- Variable rate buy to let mortgage.
- Capped rate buy to let mortgage.
- Minimum status buy to let mortgage.
- Self certified buy to let mortgage.
- Limited company buy to let mortgage.
- Non resident buy to let mortgage.
Features
Buy-to-let mortgage can be a remortgage on the current property or a mortgage on the property to be offered for rent.
- Most lenders allow for loan amount up to 75% to 80% of the property value.
- Borrowers require making a minimum down payment of 20%-25% of the property value.
- The maximum amount of loan amount depends on the rental income of the borrower or his monthly income or a combination of both.
- In most cases lenders expect the rental income to be around 25% to 30% higher than the mortgage payments. The extra sum is used to make up for the period when there is no rent or to pay service charges, maintenance costs and other fees.
- These mortgages offer a slightly higher interest rate compared to that of other mortgages.
- The mortgage can be either interest-only or a repayment mortgage with monthly payments including both principal and interest. With the interest only option, the unpaid loan balance is to be paid at the end of the loan term. This can be done with the help of an endowment policy or personal pension plan.
- A buy-to-let mortgage requires high monthly payments since the interest rate charged on these mortgages is higher than that of the others.
- There is no tax relief when payments are made following the interest only option.
Am I due any income tax relief on an interest-only, buy-to-let mortgage?
Hi J Browne,
Welcome to our forums.
You can qualify for tax deduction on your interest-only buy-to-let mortgage if you have your name on the title and the loan as well as if you itemize your deductions.
Good luck
Welcome to our forums.
You can qualify for tax deduction on your interest-only buy-to-let mortgage if you have your name on the title and the loan as well as if you itemize your deductions.
Good luck
If this sounds like the sort of thing you might say, then think again. The BTL mortgage market is a specialist market, so it makes sense to get advice before dipping into property investment, particularly if this is your first time.
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melkinny
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melkinny
While applying home loans, you may require to shop around and talk to several lenders that offer first time home buyer loans.
I'm baffled.
Buy-to-let mortgages have been on offer in the UK since the late nineties; they are specifically designed for investors to borrow money to purchase property .
I think it would be a good idea to buy the property first and then make your intentions clear that you want to let the property after the fact. I think it would be possible to cut some corners here. You might want to ask advice from this great Columbus real estate agent that I go to for answers.