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Switching to a buy to let mortgage

Moving from a mortgage for residential use to a buy-to-let mortgage is quite typical. Many scenarios could justify a mortgage switch like moving home or having a vacant house that is a part of the residential mortgage.

If you are a homeowner with an existing mortgage for your home but would like to change to a buy-to-let then you’ll need approval of your loan provider. If the lender you currently have declines the remortgage option, it could be an option for you with a new lender. It could result in penalties for early repayments, based on the mortgage’s term.

The decision to switch mortgages is based on:

The type of mortgage you currently have
What do you intend in relation to the property
Your future arrangements for living
Other mortgages that you own
The terms of your mortgage currently
Lender consent

How do you change your mortgage to buy to let

Because this is a financial decision the decision to switch mortgage types requires care and consideration. It’s not something you can be done in a hurry. Make sure to consult with a specialist for advice if you’re uncertain. Ask our experts anytime and verify whether you’re eligible.

A mortgage for buy-to-let is different than a mortgage for residential properties. It is possible to increase the rental income, for example when it was previously not be an alternative. Our experts can immediately determine what buy-to-let rates you’ll be eligible for and go over the different aspects with you.

If you only modify your mortgage contract with the existing lender, then you’ll be presented with the rates they offer. This means that you’ll only be able to choose one lender. In the end, you’ll be unable to have the choice of selecting the most suitable mortgage that you’re eligible to get. Our experts have access to all UK lender, meaning you’re certain to find the most competitive rate.

Purchase a new house and changing your existing property into a buy-to-let

The process of changing a residential mortgage into a buy to let mortgage and then buying an additional home is frequent. These types of mortgages are referred to as let-to-buy mortgages. Instead of selling your existing home, you could lease it out.

You can also refinance your current home to finance the purchase of your new residence. The rental income you earn could be used to pay for the new mortgage for residential properties Now we’ve made you think…

If you’re in the opposite situation, you might have overpaid for your property and tried to sell it but are unable to sell at the amount you think that it is worth. The best alternative is to keep the home and then switch to a buy to let mortgage, and keep it until the value rises enough to justify selling.

Many lenders won’t agree to this type of arrangement. It is because of the magnitude of risk lenders take on. If a tenant fails to pay rent or you face an unexpectedly large repair bill for an apartment, the situation may result in financial stress. If you’re stuck on alternatives, you might look into a bridging loan however, be cautious and only make use of it as the last option.

Making a buy-to-let mortgage and then moving into rented housing

If you are currently a homeowner with an existing residential mortgage, but you want to get rid of it and lease a house instead There are lenders to consider. However there are lenders who will not be willing to switch. This is due to the fact that buy-to- let mortgages are typically provided to existing homeowners who own at the very least a residential mortgage.

Rents can be more expensive than mortgage payments and in the event that your tenant fails on the rent payment there could be financial problems. Creditors are aware of this risks, and therefore could reduce their lending.

Finding the lowest mortgage rate when switching to a buy to let mortgage

Finding a good mortgage rate is crucial when you are switching mortgages. If you’re already paying an excellent rate, asking your current lender for approval is a good option. Your lender could be willing to simply transfer the mortgage rate to a different property.

If your lender isn’t in agreement with you, consult an expert to find out the mortgages and rates you’re entitled to. It’s not a bad idea to find out the rates you’re eligible to receive even if the lender does agree.

Advisors will also strive to ensure you will be able to maintain the current rate, particularly when rates are more expensive.