Buy to let mortgages fall into two categories which are consumer buy-to-let and investor buy-to-let mortgages.
Consumer buy-to-let mortgages are for those individuals who become accidental landlords who do not intend to run the property as a business. Accidental landlords arise when there is a change in circumstances. A typical example would be a single person owning their own home living by themselves. At some stage they may decide to buy a new home with their partner. As a result of a change in their circumstances, as a short term solution, they may decide to rent their former home to save themselves from paying two mortgages. A consumer buy-to-let mortgage is designed specifically for this type of instance.
An investor buy-to-let mortgage is for someone buying a property specifically to run it as a business. Broadly speaking appreciation in property prices and rental yields have made property an attractive investment proposition. As a result there has been increasing demand from individuals investing in property.
In both instances main high street and specialist lenders have recognised this demand for buy-to-let mortgages and have products that cater for both sets of individuals. However – it should be noted that different affordability criteria is used by lenders to assess applicants. As a result it is advised you take independent mortgage advice for the best options based on your circumstances.
If you are considering becoming a buy-to-let landlord due to a change in your circumstances, or you are considering buying a property to run it as a business, feel free to click here to contact us to arrange a free 15-minute consultation where we would be happy to explain how we can help.
Please Note: The Mortgage Xchange is a partner of Scott & Goose LLP who are directly authorised by the Financial Conduct Authority under reference 661183. Your home may be repossessed if you do not keep up repayments on your mortgage.