Helping you move home with a let-to-buy mortgage

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In the current housing market, with the shortage of potential buyers, moving home is proving to be increasingly difficult.  To enable you to move to a new home, a let-to-buy mortgage could be the answer you are looking for, says Martin of Heywoods Estate Agents.

Let-to-buy mortgages enable you to move home and buy a different property, whilst keeping your existing property and renting it out.  A let-to-buy mortgage can be an alternative to a buy-to-let mortgage.

How does a let-to-buy mortgage work?

Eligibility is subject to the proposed rental income on your current property being sufficient to cover the cost of your existing mortgage.  A deposit may be required for the purchase of your new property and many people raise this by releasing equity from their existing property by way of a re-mortgage, subject to there being sufficient levels of equity available.

How do lenders work out let-to-buy rent?

You will need to satisfy your lender that you meet their let-to-buy mortgage calculations.  Lenders have different methods of assessing this but in general it is a formula that requires that the level of rental income is sufficient to meet the level of mortgage repayment, with an additional degree of margin thereby providing the lender with a greater level of comfort and reassurance.

What are the advantages of a let-to-buy mortgage?

Retaining your property as an investment enables you to benefit from the mortgage being repaid either in full or in part by the tenants.  If you are having trouble selling your property it can be of real benefit, or it could be a springboard to starting your property portfolio.  The rules of let-to-buy lending are different and can be more flexible.

What are the disadvantages of a let-to-buy mortgage?

You must ask your existing lender for permission to switch to a let-to-buy and you must also inform your buildings and contents insurance provider.

How should I go about getting a let-to-buy mortgage?

For more information about let-to-buy mortgages, contact Martin at Heywoods for further information. 01782 664995

There is no guarantee that it will be possible to arrange continuous letting of the property, nor that rental income will be sufficient to meet the cost of the mortgage

Your home may be repossessed if you do not keep up repayments on your mortgage.

There will be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.

To find out whether a let-to-buy mortgage could be an option for you, speak to an expert adviser today by calling (insert number).