Think carefully before securing other debts against your home.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Mortgage Glossary
- Mortgage Glossary Choices:
- 100% mortgage
- Arrears
- Buy to let
- County Court Judgements
- Defaults
- First time buyer
- Flexible mortgages
- Individual Voluntary Arrangements
- Keyworker mortgages
- Let to buy
- Non status
- No deposit mortgage
- No proof of income
- Self build
- Self certification
- Self employed mortgage
- Underpayment
Let to buy
'Let to Buy' is an alternative to 'Buy to let'. A Let to Buy mortgage works by allowing you to borrow money to buy a new home to move into, whilst your existing residence is let out to tenants.
The let to buy mortgage is useful if you are relocating but want to keep a base locally or if you want to retain your original property as an investment and benefit from rental income to help towards the mortgage repayments.
The rules are different from "Buy To Let" as you may be able to borrow a higher proportion of the property value. For 'Let to Buy' you may need a smaller deposit or if you have plenty of equity in your current property possibly no deposit is required at all.
When considering taking out a Let to Buy Mortgage on an investment property, it is always prudent to consider some of the downsides, such as
• There may be void rental periods when the property is not tenanted and so no rent is received.
• There could be a decrease in rental income due to adverse economic conditions or as a result of a substantial increase in the supply of rented accommodation in a particular area.
• Increase rates could increase on any loan taken to acquire the property, without a corresponding increase in the rental income to cover that interest.
• There could be a fall in the value of the property - if the property has to be sold, you might not get back all you have paid.
You will need to seek permission from your present lender to let out your present property, and you must notify your buildings and contents insurer too.
Let us help you
Harbour Mortgage Savings Centre can help find you the most suitable 'let to buy' mortgage for your circumstances. We are independent mortgage brokers and have access to over 4,000 mortgage products.