Buy-to-Let Mortgages

The Buy-to-Let market has seen huge growth as more people look to invest in property.

Advice should be sought……

The Buy-to-Let mortgage application can be quite complicated as lenders use various rental calculations when making their assessment.

If you are looking to purchase or remortgage a Buy-to-Let property, please let xpressmortgages help to explain the process in detail.

We have access to all the lenders in the market and often some exclusive deals from the lenders are available only via Mortgage Intermediaries, such as ourselves.

We can source through all of the products on the market to ensure we find the right mortgage for you.

Property
The buy to let mortgage lender will want to establish whether the property you are buying is suitable for lending purposes. Some lenders will not lend on certain properties which can include studio flats, properties above shops, nonstandard construction etc. It is important to know from the outset that your personal circumstances and the property intended meet the lenders criteria. At xpressmortgages we have vast knowledge of the lenders in the Buy to let space and can recommend the most suitable product for you.

Buy to Let deposit
The deposit you will be required to put down for a buy to let mortgage will be typically larger than for a standard residential mortgage – most lenders offer a maximum loan to value of 75% which requires a deposit of 25%, however there are some lenders available who require a smaller deposit such as 15% or 20%

Rental income
The rental income must exceed your buy to let mortgage payments by a certain percentage – as an example, the mortgage lender may require a rental income of 125% of the monthly mortgage payment based on their stress test rate and every lender has their own criteria. If you need to find out more, please contact us

Stamp Duty
From April 1st 2016 Stamp Duty Land Tax (SDLT) on Buy to Let properties increased and there is an additional surcharge that is applied on top of the normal SDLT rate. This means the majority of buy to let purchases now attract an additional 3% stamp duty surcharge. For example, the changes have increased the stamp duty tax payable on a £275K buy to let purchase from £3,750 to £12,000. HMRC have a useful stamp duty calculator on their website.

Taxation on Buy to Let
From 6th April 2017 Interest on a buy to let mortgage will no longer be able to be wholly deducted from the property rental income to calculate profit on which income tax calculations will be based. From 2020 no finance costs are deductible at all. The new rules are to be phased in gradually from 2017 through to 2020. Due to these new rules we advise all our existing Buy to Let clients and anyone looking at purchasing a Buy to Let to get specialist tax advice.

Limited Company Buy to Let
Limited company Buy to Let has seen an increase in popularity in recent months as this can often be a more tax efficient way of owning Buy to Let properties. Your accountant will be able to advise you on the best way forward for you. The limited company can be set up as a brand company specifically for the purpose of owning Buy to Let properties or can be a Company that already has a trading history. Landlords may wish to consider transferring existing rental properties into a company or acquiring any new properties within a company. We have access to many lenders offering Limited Company Buy to let mortgages. Please contact us for more information.

For more information, please contact us.

Buy to Let Mortgages are not regulated products and therefore the protection that normally exists for customers do not apply.

Buy-to-Let Mortgages Specialist Broker Surrey LondonXpress Mortgages