Buy-to-let mortgages only apply to you if you intend to rent out the property you are buying to a prospective tenant. They tend to be more expensive than any other mortgages, however they are structured in a way to enable property investors to make financial returns.
What is the criteria for buy to let mortgages?
Each mortgage lender will have their own criteria however generally speaking you will be eligible for a buy to let mortgage if you can show the following:
- Minimum of 21 years old and maximum age of 80 at the time the mortgage would expire
- Resident in the UK
- You are applying for a loan of at least £25k
- The value of the property you want to purchase is at least £40k
- You already own your own property or you are making a joint application with someone who is an existing home owner
- The loan to value typically ranges between 20 – 35% depending on the lender and your circumstances
- The rental income must be at least 125% of the monthly interest due
- 5 – 6% interest rates
- You are able to demonstrate earnings of £25k per year or above (not all lenders ask for this but it is very common with first time buyers)
If you want further information on buy to let mortgages the best thing to do is speak to an independent mortgage broker who will be able to tell you what your options are depending on your individual circumstances.