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Buy to let mortgages

Advice on obtaining a mortgage, letting property, rental income, finding buy-to-let accommodation, buy-to-let apartments, deposit and status checks

As an older person you might be interested in the buy-to-let market, perhaps because you have cash to spare or because you have inherited a property. Buy-to-let mortgages have been designed to help private individuals invest in property to let without being penalized by extra charges or high interest rates. These mortgages are not the same as a those provided on a home in which you want to live. Instead, the mortgage lender will want to know the letting and income potential of the property, rather than your personal income. They will want to know that you are thoroughly aware of the market conditions in the area and that you have conducted comprehensive market research.

When you arrange a buy-to-let mortgage you will be subject to the same status checks as with any mortgage. In general, you will be able to arrange a loan for anywhere between five and 45 years and from 15 – 80 per cent of the purchase price. The mortgages are usually about 0.5 per cent higher than a normal standard variable rate mortgage and are available in long, short, fixed or capped options.

As with other types of mortgage there are still some good buy-to-let deals available, although you will need to shop around for the best deal. These will be more favourable if you are able to pay at least 20 per cent deposit. However, you should note that some mortgage companies will not lend money for some city centre buy-to-let apartments as these are becoming increasingly difficult to let. Heed the advice of your mortgage company – if they are unwilling to lend on a property find out why and consider moving onto something that represents a better investment.

There are various price comparison websites that enable you to compare the different buy-to-let mortgages that are on offer. When conducting your research you should visit a few different sites as some price comparison websites provide information only about companies with which they have a company agreement. The following websites have been provided to help you to start your research, but there are plenty more available.

www.comparethemarket.com/mortgages
www.moneyexpert.com/money/mortgages/mortgages/home.aspx
www.yourmortgage.co.uk/buy_to_let_mortgages
www.godirect.co.uk/mortgage-repayment-calculator.php
www.moneysupermarket.com/mortgages/buy-to-let

When visiting any website remember to use your common sense: don’t pass on any personal or financial details to a person or organization you know nothing about; don’t sign up for anything unless you are absolutely sure that it is right for you and check that the company is legitimate and regulated. You can check that a firm or individual is regulated by the Financial Services Authority (FSA) by consulting their register, which can be found at www.fsa.gov.uk/fsaregister. If a firm or individual is regulated you will be able to access the relevant complaints procedures and compensation schemes if things go wrong.