![]() ![]() You may be looking to make a small profit each month from the rental income, then make a more dramatic windfall when it comes to selling the property years down the line. ![]() If your main ambition as a landlord is to reap the rewards of owning a BTL property further down the line, when you expect house prices will have risen considerably, this might negate the fact that the full cost of your loan will still be the same at the end of your mortgage term, and you won’t have paid anything off the capital at all. On average, lenders tend to insist that the rent you’ll receive should be at least 125% of the mortgage payment, which may be stress tested at a higher interest rate, although some might be as high as 145%. ![]() The strength of your application, and a major factor in whether you’ll be successful in securing a buy-to-let (BTL) mortgage in the first place, will depend on whether your buy-to-let property will generate a larger monthly income than the amount you have to pay back to the bank. Let’s look in closer detail here at why that is: Lower monthly payments If you’re a landlord and are looking at mortgage options, there are a variety of reasons you might want to choose an interest only loan rather than a repayment. ![]()
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