What does Let to Buy mean?
The term ‘Let to Buy’ refers to someone who is moving house, but rather than selling their existing property choose to keep their property with the intention of letting this property and buying a new residential home to live in.
There are many reasons why you may choose to do this. Initially it means you are a ‘chain-free’ buyer, not dependent on selling your property to buy your new home. It also allows you to increase the number of properties you own and generate further income.
Whatever your reason Let to Buy can be a great option, providing the finance works. This is where we come in!
Let to Buy Deposit
In order to buy a new property you will need a deposit of at least 5%, ideally more. You also need to factor in stamp duty costs, legal fees etc…. Whilst some clients may have this in savings, for most the aim will be to raise this via a mortgage.
Your existing mortgage will be on a residential basis and will need to be changed to a buy to let mortgage as your property is set to become a rental. This means remortgaging to a buy to let mortgage, at this stage we would explore the option of releasing equity from the property in order to help with the deposit and costs associated in buying your new home. This remortgage will depend on the rental value of your property, as well as your income and outgoings.
This mortgage can also be moved to interest only if desired, which will probably reduce the monthly payments of the mortgage.
New Residential Mortgage
The ongoing residential mortgage is similar to that of a home mover, where the usual affordability calculations are required to provide you with a budget. However, the lenders do need to be aware and comfortable with your Let to Buy scenario, not all lenders can accommodate.
Hawk Mortgages will simplify this process, we will ensure we look at all the options for you in terms of raising the mortgages on the respective properties, checking the lenders criteria and submitting the applications to ensure there are no issues and we reach the best outcome for you.
Why choose us?
We have a vast amount of experience in arranging let to buy mortgages for our clients. We know the correct lenders to place these mortgage with to achieve the best results.
We will guide you through the process to ensure you understand and are comfortable with the Let to Buy proposition.
Using an experienced and knowledgeable broker is vital with let to buy mortgages where there are many different factors to consider. This is certainly an area a comparison site or robot will not be able to cater for and highlights the need for a personal service.
With our knowledge and experience we will handle everything efficiently and with the minimum of fuss.
Do you need help? Fill out this form to get in touch.