Purchasing a property specifically to rent out for investment income requires a different type of mortgage – a Buy to Let mortgage. With this type of mortgage, the property legally can’t be used as your own residence.
If you already own your own home and now want to become a landlord, you may be able to switch your existing residential mortgage to a Buy to Let with permission from your lender. Or you can remortgage to a new Buy to Let mortgage.
Buy To Let Mortgage Eligibility
To qualify for a Buy to Let mortgage, typical requirements are:
- Being an existing homeowner ( although not essential)
- Meeting the lender’s minimum income threshold and or meeting the lenders pay rate.
- Having a strong credit score
- Providing a deposit of at least 20%
How Buy To Let Mortgages Differ
There are some key differences compared to standard mortgages:
- Higher deposits required – usually 20% or more
- Application fees and interest rates are higher
- Monthly repayments are often lower as most are interest-only
- The loan balance gets repaid at the end of the term, commonly through selling the property
- Some Buy to Let mortgages are not regulated by the FCA
The experts at JAG Funding Solutions fully understand Buy to Let mortgage products. We will explain the specific requirements and guide your application to match you with the right lender.
