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Monday to Friday

38 Queen Street,

Glasgow, G1 3DX

0141 380 0431

Welcome to Simple Financial Planning
25th September 2017

11:00 – 19:00

Monday to Friday

38 Queen Street,

Glasgow, G1 3DX

0141 380 0431

By To Let

A Buy-To-Let mortgage is different from a normal residential home loan, as it is for investors who plan to find tenants for the home bought with the mortgage. While many people think that it is risky to get a Buy-To-Let mortgage, it is by many seen as a safe investment opportunity. Housing shortages are creating a great business environment for people who would like to make money on the property market. Any profit made from the rent paid, after paying taxes, is a profit to be re-invested or used for larger purchases. However, these financial products are only available for people who already have a mortgage or a property that has been paid off.

Buy-To-Let mortgages are currently not regulated under the FCA jurisdiction and as such do not require “sellers” of such to be appropriately qualified or authorized – It may be in your best interests to decide whether or not an adequately qualified mortgage adviser would be better to use rather than a less qualified individual however that is purely your decision.

Mortgage rates for Buy-To-Let loans are different from residential financial agreements. Generally speaking Buy-To-Let mortgage rates are higher in most high street banks than residential interest, as these products carry more risks. While homeowners taking out a mortgage for the house they live in will be likely to look after the house, maintain it, and comply with safety regulations, when the property is let, tenants can cause damage that reduces the value of the home. Some companies, however, offer fixed interest rates for a certain number of years, and this reduces the risk for the buyer. Even if the base rate is increased during the fixed term period, they can calculate how much they need to spend on the mortgage. Advertised rates can also only there as an indicator, and every applicant is assessed based on their affordability assessment and credit history.

Most banks require at least a reasonable (15%+) deposit on Buy-To-Let mortgage accounts. The maximum loan to value (deposit) ratio is, however, determined by the personal circumstances of the buyer, and the credit rating and anticipated rental income on the property as confirmed but a surveyor.

In order to get approved for low Buy-To-Let mortgage rates, customers need to have their account in order. Lenders usually check applicants’ credit history, and make sure that the existing home loan is paid on time. Those who are in arrears with other finances, such as credit cards, car loans, or personal loans will be likely to be declined for a Buy-To-Let mortgage. This is why customers are advised to check their credit rating and clear their finances.

It is important to compare Buy-To-Let mortgage rates before submitting an application, as every time a customer applies for a financial product, their credit rating decreases. Applying for the most suitable deal first is the best solution. Customers can also review the products based on the approval criteria, so they do not waste their time on products they would be declined for. Finding out everything about Buy-To-Let mortgage rates beforehand can reduce risks of getting the application declined.

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