"Buy to let mortgages are designed for borrowers who intend to rent out property to tenants, but not to live in there themselves."

There are many different products available and Peter Morgan Financial Services are in a position to offer advice on all aspects of the rental market.

Buy to let mortgages differ from residential mortgages in the way the loan amount is calculated and the deposit required.

A brief overview of Buy to let mortgages would be:

Deposit

Normally a deposit of at least 20% is required.

Maximum Loan amount

This is usually determined by the rental income received from the property which is set by the valuer at survey.
The lender will then calculate whether the rental income meets their criteria using a % basis.

Example

• Loan amount £75,000 with a monthly mortgage repayment of £375.

• Expected rental income of £475 per month.

• Lenders % calculation of 125% of monthly mortgage payment would be £375 x 125% = £468.75.

• As the rental income is more than the % calculation the lender would accept this as proof of affordability.

Some lenders will also take into account any unused personal income. With this in mind why not use Peter Morgan Financial Services to identify the best options available to you.

When considering a Buy to let it is important to bear in mind any additional costs such as

• letting agents commission

• buildings and contents cover

• maintenance costs and any service charges

• rental and legal expenses.

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