I have used Lisa at L.J Financial for my mortgages for the past 18 years. Nothing is too much trouble and she has always given me the best advice and found the best mortgage rates. I will will continue to use Lisa for both my residential mortgages and my rental portfolio. I regularly recommend her to anyone that needs help and advise. Excellent service.
Buy-to-let mortgages! LJ Financial are the experts
If you're looking at purchasing a buy-to-let property, call 0207 7328111 to speak with our expert advisors.
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Why it is important?
Buy-to-let mortgages
Becoming a private landlord should not be seen as an easy way of making money. It can be riskier and more complicated. It can also be very time consuming, more than most forms of investment, and there is no guarantee that house prices will rise. That said, having a second property to let to tenants could reap considerable financial rewards over time.
How it is different?
How buy-to-let mortgages are different?
There are 3 main differences in buy-to-let mortgages:
- Rent Potential - the decision as to whether or not a mortgage will be offered is usually based on the rent you will earn as well as your income. In some cases your income is not ever considered.
- Interest Rate - buy to let mortgages have slightly higher interest rates.
- Larger Deposit - typically a minimum of 20% or 25% of the property's value is required as a deposit.
Things to consider
Things to consider when buying a second property-to-let
When buying a second property to let, you will need to decide whether your primary objective is income or capital growth. In other words, are you looking to make a profit month on month or are you looking to make a profit through increased equity from the second property if it increases in value over time? The decision may affect the type of property you purchase, and the location.
Additional Costs
Are there additional costs involved?
When you manage a property there are many costs involved in addition to the monthly mortgage repayments. As a guide, your achievable gross rent is between 125%- 145% of the rental property's interest only mortgage repayments in order to cover your costs should anything go wrong.
These additional costs include:
- Property upkeep - maintenance costs for the property.
- Letting agent's fees - letting agents charge around 10% of the monthly rent for finding and vetting tenants with an additional cost of around 5% if you require a full management service
- Ground rent / service charges - applicable to leasehold properties.
- Legal insurance - to cover costs from evicting tenants in the event of non-payment, very important, as this can be very expensive.
- Insurance - building insurance and contents insurance for the items provided as part of the rental agreement.
- Furnishings - the purchase of any furniture. If the property is to be let furnished, make sure you are covered for this by your home insurance.
- Gas / electrical appliances - cost of maintaining appliances and ensuring they comply with any regulations such as safety tests.
- Decorating costs - the property may require work ranging from painting, to a new bathroom suite before it is suitable for letting to tenants.
Looking for a buy-to-let mortgage?
When choosing a property to let, it is wise to take advice from local letting agents to determine; what types of properties are in need and which parts of the town are best or most wanted. They can tell you if there is a University in the town, and if students are looking for somewhere to live. Call our team today on 0207 7328111 or email admin@ljfinancial.co.uk
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Testimonials
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See what our customers say
Mortgages comes in all different shapes and sizes and which one to choose depends on your circumstances. We can help find the right one for you.
Peter
Meryem Mehmet
Lisa, helped guide and supported us throughout our whole application. She was amazing, highly recommend to everyone.
Sarah M
Lisa has advised and arranged mortgages for me for about a decade now. Lisa’s expertise and awareness of the mortgage market is extensive and I fully trust her advice. I’ve recommended Lisa to my friends whom have been equally impressed. Thoroughly recommend.
Tee T.
Lisa is a very commercially minded adviser and gets her clients what they need. Efficient and very knowledgeable and has helped me arrange a couple of mortgages. Highly recommend!
Lee
Excellent service and very knowledgable. Wouldn’t hesitate to use again and highly recommend.
Kat Sackett
I have been working with LJ Financial now for over 10 years. Lisa has never let me down; she goes above and beyond. Really pleased with the service, and I have recommended her to all friends and family. Keep up the good work!
Alexandra
Amazing service. Very thorough and put me at ease. Everything explained clearly. Highly recommended.
Find out why people trust LJ Financial for their mortgage needs
Call our team today on 0207 7328111 or email admin@ljfinancial.co.uk