Singing Pig

Hi guys

 im kinda new to this website as my father just introduced me to it...well lets get on with it - i have a property im interested in buying on a buy to let mortgage unfortunately due to the credit crunch there strict requirements from the branchs - i have applied at halfiax, birmingham midshires, abbey national and they have turned me down - the two main reasons are:

1) im under 25

2) earning just under 25k

3) first time owner

 
i was wondering if any of you guys could help direct me to any decent mortgage lenders? - below is more information about myself...

 

 

Very hard to get BTL finance at the moment, especially as a first time buyer with no other assets. Not the best time to be getting into BTL.

Every failed application will be a footprint on your credit record.

 I would guess the fact that you are not a homeowner yourself is the sticking point.

 You need to see a mortgage broker who will know which lenders will consider your application, without damaging your chances in the process.

Hi,

unless there is some upside to this deal, I'd pass, looking at the rent of £6600 per year, a quick calculation says that IF you could borrow money at 6.6% Interest Only on £100,000, you'd break even - not taking into account void periods, insurance, repairs etc. (Also buying costs, mortgage fees etc)

Yield is (6600/130000)*100 = 5%.

Also, most mortgage companies want rent to cover mortgage by say 125%, so to give you a mortgage which requires interest only payment of £6600 per year, they'd want you to be getting  6600 * (125/100) = £8,250 in rent.

I think that you'd be wiser to look for a better deal, remember, if you're buying at auction, I think that the percentages of properties sold is going down.

Also, have you thought about the value of the property, would you be happy buying this one if it goes down 10% in value in the next year, have you thought about what your remortgage options are if this happens ?

 
Good luck,

 
Chris

Hi Guys

Thanks for the replys...

 
About the property its in a great property and new built so repairs and etc should be minimal...in regards of the btl mortagage im still having problems with finding companies that will accept a person like my self...im looking to borrow about 100k and if anyone can help or suggest and companies or people i cant talk to help steer me in the right direction.
 

hi chris - i just saw your post and on discussion with my father he advised that it would be correct that the reserve that they are asking for is too much with a rent of only £6600...perhaps wait a few months..if the reserve had been 100k then it have been worth going for...possibly it may not sell..

if you are planning to buy at auction, there is no guarantee that this property will sell to you at the price you have quoted.

regards,

pete

Whether or not you go for this house, start by ordering a copy of your credit report, see how the lenders view (www.experien.co.uk). There may be anomolies you can sort out. Also contact a specialist broker before you apply to any more high street banks, a broker will advise where you can apply with a good chance of success.

You can meet specialist brokers at one our our free landlord trade exhibitions, next one is in London on 4th September and then the NEC in November, if you can't make it read Landlord & Buy-to-Let magazine for free independent advice www.landlordnet.com.

Best of luck

Oliver

www.landlordsday.co.uk