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The Financial Conduct Authority does not regulate some types of buy to let or commercial mortgages.
Buy to let mortgages in London have become a popular avenue for those looking to profit from property letting in the city.
In this guide, we delve into the key features of these mortgages, comparing them to traditional home loans and offering insights for both seasoned landlords and first time buyers in London.
A buy to let mortgage is a tool for generating income through tenant rentals, typically aimed at covering mortgage costs and potentially more.
As the owner, your aim is to let the property out while maintaining a mortgage on it. There is a strong connection between previously rented properties and buy to let mortgages.
These mortgages are designed for individuals seeking properties for rental purposes. Lenders often require higher deposit amounts compared to standard home loans, and approval is based on the anticipated rental income and the applicant’s financial standing.
Lenders usually expect the rental income to exceed the mortgage payment by around 125%. Buy to let mortgages in London can be interest-only (monthly interest payments with the full amount due at the end) or repayment-based (monthly payments of capital and interest).
Despite the slightly different eligibility criteria and associated fees of buy to let mortgages, it’s beneficial to work with a mortgage broker in London to navigate the application process and find the right fit.
When applying for a buy to let mortgage in London, lenders will assess your potential rental income.
As long as your projected rental income is reasonable compared to your mortgage request, there are typically no borrowing restrictions. However, some lenders may require the rental income to exceed the monthly payment by a certain percentage.
Eligibility for a buy to let mortgage in London generally involves being a UK resident over 18 years old, with a clean credit history and reliable income to cover monthly payments.
Lenders will assess your ability to maintain the mortgage based on both your projected income and potential rental earnings. Many lenders require a minimum 25% deposit, though lower deposits may be considered based on individual circumstances.
Speaking with a certified mortgage broker in London can provide expert advice on buy to let mortgages tailored to your needs.
Applying for a buy to let mortgage in London will require evidence of income, deposit, address, ID, bonuses, commission, and P60.
Self-employed applicants will need to provide their SA302 tax return. Established landlords must supply proof of rental income, often through an ARLA certified report and mortgage statement for any currently owned properties. Having these documents ready can streamline the application process.
Many buy to let investors opt for interest only mortgages to lower their monthly expenses. With this option, you pay only the interest each month, and the capital balance is repaid by selling the property or switching to a repayment mortgage at the end of the term.
Alternatively, you can establish a repayment vehicle to cover the cost. While interest only mortgages are popular and seen as tax-efficient, repayment mortgages for buy to let properties are also worth considering.
Although they may entail higher monthly payments, they help build equity in the property and provide full ownership at the end of the term without a large lump sum payment.
A let to buy mortgage in London allows a homeowner to let out their property for income. This type of mortgage is typically used by unexpected landlords who decide to let their property instead of selling it when moving.
Instead of selling their home and purchasing a buy to let property, homeowners can let out their current property and use the income to offset their new residential mortgage, providing an additional income source without the need to buy a new property solely for letting purposes.
If you already own a property, you might consider temporarily leasing it out without converting it into a permanent buy to let property through a provision known as ‘consent to let’.
Not all mortgage lenders offer this option, and those that do may limit the number of days per year you can lease out your property, usually between 30-90 days depending on the lender.
If you anticipate using this provision, check with your lender to see if they offer it. Remember, this is a temporary measure; long-term rentals without converting to a buy to let may not be allowed and could result in penalties.
When considering a buy to let mortgage, important factors to contemplate include whether the property is a short-term or long-term investment, the size of the deposit, types of interest rates, and associated fees such as arrangement and valuation costs.
Your final mortgage choice should align with your financial status and future plans. For guidance, speak with a mortgage advisor in London.
Buy to let mortgages in London offer the opportunity to own multiple properties, either individually or through a limited company. There is usually no legal limit on the number of buy to let mortgages you can have, but this may vary between lenders.
With each application, the lender reassesses your ability to repay the additional debt. Many buy to let lenders require proof of rental income, using this to assess your ability to repay alongside your personal income and financial commitments.
Generally, buy to let landlords do not reside in the properties they rent out, as this could be considered a breach of contract and may result in penalties or legal action.
However, if your buy to let property becomes unoccupied, you may consider converting it into your primary residence, likely requiring refinancing. For more information, speak with a specialist in buy to let remortgages.
Switching from a residential to a buy to let mortgage may require discussions with your lender to understand available options. Some lenders may approve a seamless switch, while others may require a new mortgage application.
If you choose to switch, the lender may require a minimum income or a certain level of equity in your property and will likely assess the potential rental income. It’s advisable to speak with a financial professional or tax advisor to understand how such a switch may impact your financial situation.
A mortgage broker in London’s job is to help you through your entire mortgage journey, from start to finish. They will not only help you find a mortgage product tailored to your personal and financial situation, they will try to find you a deal that saves you time and money.
As a mortgage broker in London, we are able to search through 1000s of mortgages on your behalf to find you the perfect mortgage for your property. Via our large panel of lenders, we are able to access both high street and specialist mortgage products and deals.
If you were to go to a bank, they would only be able to access their own in-house products. There are many different options out there and you may be able to save money by exploring your other options. We can even access specialist categories such as buy to let mortgages in London or mortgages for those using a government scheme.
We offer free flexible mortgage appointments, allowing you to speak with a mortgage advisor in London 7 days a week. Our appointment slots go from early in the morning to later at night, meaning that you can pick a slot that works around you and your busy working and personal schedule.
You can now book your free mortgage appointment online too -we’ve made it simple and easy! Alternatively, if you would prefer to book your appointment over the phone, that’s fine too!
During your free mortgage appointment, your mortgage advisor in London will perform an affordability assessment on you to work out how much you are able to borrow and what deals you are able to access. Once we find the perfect deal for your circumstances, and you are happy to continue with us and the mortgage deal, we can begin to prepare your mortgage application.
We will help you prepare the required evidential documents to support your income and affordability. Our team will be right by your side throughout and will answer any questions that you have. Once we send off your mortgage application, we will keep you updated on the progress of your application. As soon as we hear back from the lender we will be in touch straight away to give you the good news!
Our mortgage advisors in London are able to sort an agreement in principle within 24 hours of your free mortgage appointment! You will need an AIP during the build-up towards your mortgage application to support any offers that you make on a property.
AIPs usually last between 30-90 days; if yours expires, just get back in touch with our team at Londonmoneyman and we can renew it straight away for you.
When it comes to the point of your remortgage in London, we will be back in touch to make sure that you are still on the best rate available for your individual circumstances.
We will reassess your mortgage situation and look at your options with you, making sure that you make an informed decision that benefits you and your finances.
If you have any questions whatsoever, give our team a call and we will be able to pass you on to a mortgage advisor in London who will be able to give you tailored advice based on your individual situation.
Getting mortgage advice in London should be at the top of your list when it comes to buying a property, especially if you are a first time buyer in London. It is always worth taking advantage of our free mortgage appointment and getting an idea of what your options are.
The world of buy to let mortgages in London and making investments in property can prove to be incredibly beneficial to some, allowing for landlords to earn further profits from the properties in their portfolio. Beyond just your standard type of buy to let mortgage, however, there are a variety of other buy to let mortgages available.
One of the variations that is more closely related to a buy to let mortgage, is a let to buy mortgage in London. There are also HMO’s, which are houses of multiple occupation and holiday let mortgages in London. The latter is to be the focus of this article.
A holiday let in London is another form of a buy to let in London, that will see landlords renting out a home temporarily to both tourists and visitors, during their travels to that location. Tenancies are usually done as short-term ones and there will generally be a few of these throughout the year.
Because of the nature of the holidaying industry, there is more than likely going to be a few periods during the year where the holiday season dies down a little bit, meaning you won’t always have a consistent income. This can mean mortgage lending criteria will be much stricter.
As is the case with any mortgage, you will of course need to make sure that you match up against the strict mortgage lending criteria of a holiday let mortgage in London, before your mortgage applicant can be approved. Criteria can vary between different mortgage lenders, though typically it is the same criteria throughout.
For the most part, you will find that you need to have at least a 25% deposit, a minimum income per year (in addition to the rental income you will be making), a rental income that can help to cover your monthly mortgage payments (with further margins to meet) and also holiday home insurance.
The latter will help to cover you in the event of any possible booking cancellations or loss of income you could be faced with. Holiday homes are typically seen as a much higher risk investment purchase, as it is incredibly likely that there will be periods when you are not making a great deal of income, if any at all. As such, interest rates will more than likely be higher.
At the end of the day, this is all about how you weigh up the positives and negatives of holiday let mortgages in London. They are able to help provide you with additional income, with the bonus of you being able to charge a premium for school holidays or peak seasons, due to the high demand.
In addition to this, you may also have the possibility of deducting expenses from fully furnished holiday homes, though this can vary. Some landlords may find that they have certain tax benefits, though there will be specific criteria for them to meet and we highly suggest speaking with a qualified tax advisor in London to learn more.
Further to this point, whilst you could potentially charge more during the peak seasons, you could find it a bit of a challenge to even buy a property at all. Tourist hotspots will also come with premiums on price, though if you can look past that, you would also likely make more rental profit from those locations.
Interest rates can be a negative for some, as you will most likely be paying much more on interest rates. Depending on the amount of properties you have to your name, you could also find that you are paying a lot more on stamp duty tax as well. When you combine this with running costs and general maintenance, it soon all adds up.
Once again though, this will all depend on the location of your property and the amount you are charging on rent, especially in peak seasons. In more popular times of the year, you may be able to lessen the impact of these factors. Still, when there are lengths of time where no income is being made, you do need to make up the shortfall.
Speaking of having periods of downtime, whilst financially this is a negative, it can contribute to a truly eyebrow raising area of holiday lets in London. This being, that you can use it as a holiday home for yourself, when not fully booked! This is contrary to a buy to let mortgage in London, where you cannot live in your property at all.
Really it all comes down to what works best for you at that point. Sure there are many different costs to think about, though if you play your cards right, the profit could make it all worth it and leave you with a place to go and spend some much needed “me-time” when the property is not being occupied.
A standard buy to let mortgage in London will be for a rental property. That property is typically offered to long-term secure tenants. Tenancy lengths are, as a general minimum duration, between 6-12 months, with individual terms that will be set by a landlord. The amount you are able to borrow will depend on potential rent, as opposed to your income.
On the flip side, holiday let mortgages in London are usually only intended for the short-term. A standard holiday let mortgage tenancy is around a month at a time and can lead to fluctuations in your income, as with holiday lets there are usually off-peak seasons where securing a short-term tenancy can be a little challenging.
In order to figure out roughly how much you are able to borrow, they will be looking at a few different things like potential for rental income more in-depth (reviewing the various lettings seasons), as well as taking a look at your personal income.
An Agreement in Principle (also known as an AIP or Decision in Principle) is where you pass a Lender credit score to qualify for a mortgage.
By obtaining an Agreement in Principle, you prove that you are ready to support any offers you make as a first time buyer in London. It may also aid in negotiating a lower price if you have one of these as it shows the seller you are serious and have the means to continue with the process.
The more frequently seen methods of credit scoring are via soft searches, rather than a hard search. These may still affect your credit score, though usually a hard search will be more likely to do this than a soft search.
The reason for this, is that a hard credit search leaves a credit footprint, whereas a soft search does not. Regardless, you can rest assured that whichever is used by the lender, is done with the best intentions.
Having your credit checked via a hard search every so often should not make too much difference. It becomes an issue if you take too many of these within a small amount of time.
On the flip side, if you know you have a good credit score and it’s the best path to take with a lender, this should not be a problem.
Whilst the prospect of this would be nice, there are no guarantees that having an Agreement in Principle will allow you to get a mortgage. The Lender will still require seeing all your documents and only then will an Underwriter make very final decision.
Often we find that customers contact us after they have been declined at application stage, due to missing some small print in their Agreement in Principle. You will need to provide ID to prove that your identity, payslips to prove your income and bank statements to prove you are smart with money, before a lender will offer your case.
Though you are able to make an offer without an Agreement in Principle, we would not suggest doing so. Any credible Estate Agent will want you to prove you can definitely go forward.
It is possible to obtain an Agreement in Principle within 24 hours of getting in touch with an experienced mortgage advisor in London.
Typically,an Agreement in Principle will expire after 30-90 days. The good news is that this doesn’t mean you should just apply for the first house you find. If your Agreement in Principle expires, it’s not a difficult task obtaining another ahead of making an offer.
Finding a mortgage only to be declined a mortgage can cause understandable disappointment. With this in mind, we recommend getting an Agreement in Principle as early as possible.
When you start your mortgage process, if you choose to use a large estate agent, they will want you to use their in-branch Mortgage Advisor and their recommended conveyancers.
You don’t have to use their in-house advisor however, in fact you can still get the same or better deals from somewhere else! Unfortunately, first time buyers are often the ones that get caught out and end up coaxed into using their internal services.
Searching for an external Mortgage Advisor in London could be the best path for you to take. An estate agent’s advisor will be biased, only encouraging you to see their side as they just want you to stay on with them.
A dedicated mortgage broker in London will be able to give you more perspective and see different sides. If you do your research and still end up back with your in-house advisor, that’s fair enough, though you should always remember that you have other options out there.
Our view consists of both transparency and efficiency, as we want to provide the best possible experience and the best advice for your personal and financial situation, whilst still delivering a fast yet friendly service.
If you end up choosing to use your estate agent’s in-house mortgage advisor and conveyancer, you need to think about where the cost of their service is coming from. Maybe they are charging you for their services without asking you and adding it to other fees, so that you don’t notice. Taking the route of a trusted mortgage broker in London will eliminate these concerns, as you know exactly what you are paying for. Your dedicated advisor will break each cost down for you and answer any questions of uncertainty you have with what’s going on.
Even though it is an illegal tactic, if you have opted not to take the estate agents in-house mortgage advice, they may refuse to put your offer forward on a property. For example, you could be using a broker and they may push another offer to completion over yours, purely on the basis that you aren’t using their services. Once again, these situations are illegal.
Estate agents may get even craftier and try to charge you with extortionate in-house conveyancing fees. Even with a straightforward purchase, they could try and charge you with fees upwards of £1,500. If you encounter anything like this during a purchase, you have all rights to ask them where they have got these prices from and for them to provide a full breakdown of everything.
An experienced mortgage broker in London only has your best interests at heart, and all of this can be avoided by going to one over an estate agent for mortgage advice.
Choosing the right Mortgage Advisor can be hard; but is there a way to make it easier?
Sometimes your case will be specific and might require specialist care and attention. An estate agents in-house advisors don’t care about this and just want to make money off you. When you get in touch with a mortgage broker in London, you can be matched up with a specific advisor who has experience in that field.
For example, we have specialist buy-to-let mortgage experts who can be called upon if a buy-to-let enquiry is presented to them. Once you’ve had a free mortgage consultation and an agreement in principle (usually turned around in 24 hours or less), you could be linked with your perfect advisor and get a head start on your mortgage process..
We have years of experience providing mortgage advice in London and have been helping struggling customer take that leap into the mortgage market for over 15 years now as a company. You can find out more about our excellent mortgage advice service by looking at our fantastic customer reviews.
If you would rather “go it alone”, you should know that it’s perfectly okay to do so. The majority of things you need can now be done online! Along with the use of price comparison websites, you may be able to find yourself the most appropriate deal.
The benefit of doing things online is that you have the chance to save money on additional fees. As long as you are confident in what you are doing and know what you are looking for, you could complete the process very quickly.
One thing to note though is shopping around and comparing online may be a little harder than you think. You will need to make sure that you’ve found the most appropriate fit before agreeing to anything. Here are some things you should be wary of when choosing to find a deal by yourself:
It isn’t difficult to make an appointment with your bank’s Mortgage Advisor, however, it may not be the right choice for you to make. If you do choose this route, here are a few things you should keep an eye out for:
Working alongside a mortgage broker that is not associated with the estate agent ensures you have someone working purely on your behalf as an inexperienced first time buyer in London. This also ensures there’s no conflict of interest risks.
Everything will be kept between you and your designated Mortgage Advisor in London. We have no external ties to any building societies, banks or estate agents. When we work, it’s solely for you and only you. Whilst we have lenders on panel, they’re purely there for the deals they offer, allowing us to find the most appropriate case for your case.
Our team have your best interests at heart. Managing Director Malcolm Davidson is here to explain the pros & cons of using a dedicated mortgage broker:
When buying a property, you will need to put down a deposit. This deposit amount can change depending on the property value, your credit score and your personal and financial situation.
Your lender will need to know that you are a reliable applicant, therefore, you will have to pass certain affordability assessments before your application is accepted.
A Mortgage Broker in London like us will help you prepare your mortgage application and make sure that you look the best that you can do in front of your lender.
Pre-credit crunch era, you wouldn’t need a deposit to get a mortgage, in some cases, you’d be able to borrow 100% of the property’s price. Some lenders were even offering more than the actual value of the property, for example, you may get £125,000 for a £100,000 property. You can see where it all went wrong.
You are now required to pass affordability assessments before being able to borrow any amount of money this large. Lenders don’t want to be lending to someone who cannot afford to pay them back. The last thing that they want is to repossess your property.
Usually, you will need a 5% deposit minimum. If you cannot make this amount, you may need to ask for help through a gifted deposit or continue saving until you reach the required amount.
The government cannot pay for your deposit, however, there are schemes available that can help you increase your deposit amount.
For example, the Help to Buy Equity Loan scheme, allows you to make up a 25% total deposit. You will have to meet the 5% minimum deposit, then the government will top it up to make up a total of 25%. This scheme only applies to new-builds and you have to be a First Time Buyer in London.
The Equity Loan that the government lend you is interest-free for the first 5 years. Afterwards, you’ll start receiving interest on the amount left.
Most high street lenders will ask for a 5% minimum deposit. If you’ve got bad credit, you may be asked to put down a higher percentage, e.g., 10-15%.
If you’ve got your 5% deposit and are ready to make an offer on a property, you will need to arrange a mortgage agreement in principle so that the estate agents are aware that you’ve been accepted by your lender. As an experienced Mortgage Broker in London, we are able to prepare you a mortgage agreement in principle within 24-hours of your mortgage appointment.
Having poor credit may mean that you have to put down a higher deposit. Some lenders may ask for 10-15% of the property’s value. They need to make sure that you are a reliable applicant that can afford their mortgage payments before lending to you.
There are different ways to improve your credit score. If you try to implement these changes and show your lender that you’re trying to improve your finances, it will reflect better on your application.
If you are looking at taking out a Buy to Let in London, you are going to need a minimum deposit of 25%.
When it comes to taking out your second, third or even fourth mortgage, you’re going to need a higher deposit, no matter what the reason is for doing so. Affording multiple sets of mortgage payments can be difficult, and that’s why lenders ask for more evidence so that they’re certain it’s within your limits.
Despite this being possible, not all lenders will allow it. It’s rare to find a lender that is okay with this as you would have a 100% mortgage.
This would result in you having two sets of loan repayments going out, which could be difficult to manage.
Yes, you can receive the deposit as a gift. Typically, buyers receive a gifted deposit from their parents or family members when they’re struggling to make up the minimum 5% deposit.
This must strictly be a gift and not a loan. The party gifting the deposit must confirm that this is the case.
As a Mortgage Broker in London, we see situations where the gifted deposit boosts the applicant’s deposit up to around 7 or 8%. This can make you appear more reliable and have a positive impact on your application.
There are some of the main situations where you may not need a deposit for your mortgage:
Please note that the above information and guidance is for reference purposes only and is not to be viewed as personal financial or mortgage advice.
If you are considering Moving Home in London, you are either in one of two boats; you are set on whereabouts you want to live, or you have no idea and have just started the process!
For those still unsure about where you want to live in London, we have put together a list of the best areas to live in and around the area.
Camden is a large, vibrant area in North London and homes over 280,000 people. Many families, couples, and single homeowners have settled down in Camden over the last decade and it is likely that more will make the move here too! This popular London borough is sometimes considered to be the best place to live in London.
Camden consists of four main areas; Camden Town, Bloomsbury, Chalk Farm and Hampstead. In these areas, you will find a wide range of property styles. Terraced housing is quite common, particularly around the Camden Town area, however, you’ll still find apartments dotted around and lots of semi-detached and detached property options. Whether you are looking to raise a family in a bigger space or move into a quieter place by yourself, you are sure to find something in Camden.
How about things to do in Camden? Camden is one of the liveliest places to live in London. With eateries, wineries, bars, markets, museums, art centres and places to shop, in Camden, there is always something to do and things going on around town. You’ll even find regular music events at locations such as the Roundhouse, Keats House, The Fiddler’s Elbow and Regent’s Park.
Whether you are a first time buyer in London or looking to Move Home in London, you should consider Camden as somewhere to move to. Camden is rapidly becoming the most popular area to live in North London, you could be a part of it!
Brixton is a small, lively district in South London, with a population over 80,000. It isn’t located too far from central London; just south of the Thames and East of Clapham.
One of the best things about living in Brixton is the affordable housing. Usually, there is also something for every type of person and their budget. Typically, we find that more people choose to rent in Brixton than buy, however, there are still frequently properties up for sale. As a Mortgage Broker in London, we can help you through this process and try to find you the best deal available for your personal and financial circumstances and your property.
In the trendy, modern town centre of Brixton, you will find many places to eat, drink, shop and explore such as markets and parks. You’ll also find cinemas, concert venues and nightclubs. With strong transport links directly to central London via railway or subway, you can get in, around and out of Brixton easily too!
If you are raising a family, you’ll be pleased to know that there are many excellent schools in the Brixton area. Brixton is home to many primary and secondary schools, which is perfect if you currently have a family or are looking to start one.
If are thinking of starting your moving home process and Brixton is on your list of potential places to move to, get in touch with our team and we can arrange a free mortgage consultation to discuss your mortgage options.
Richmond is situated in South West London and is known to be London’s most picturesque borough. The area is full of magnificent green spaces and plenty of amenities dotted around the area. Furthermore, there are many celebrity connections with Mick Jagger, Sir David Attenborough and Richard E. Grant owning homes here.
If you are looking for a perfect blend of country life and city living, Richmond is the place for you! This town has beautiful architecture, luxurious properties and rustic pubs with beer gardens. Richmond has a variety of properties both modern and dated with flats and terraced housing that is perfect whether you are moving as a family or moving as a couple or even on your own.
The area has many secret gems including Marble Hill House, Pope’s Grotto, Garrick’s Temple and Turners House. Furthermore, there are plenty of gorgeous parks and gardens, historic houses, theatres, museums and galleries.
Richmond Underground Station is perfect for them Central London commutes, however, there are also plenty more transport options like train. Furthermore, the area has lots of schools if you have a family or are looking to start one each providing primary or secondary education. Richmond is a brilliant area for both First Time Buyers in London and home movers in London! Benefit from living in a beautiful part of London that has a thriving community with a stunning landscape and plenty of things to do.
Hackney is a district in East London and forms around two-thirds of the area of the modern London Borough of Hackney. It’s known for being the home of Hackney Empire which was built in 1901 and has been reborn as one of the capital’s premier live comedy venues. There is also a large green space called London Fields that has a lido, basketball field and a cricket club.
There are plenty of activities to do for all ages such as Hackney City Farm. If you have a family, this is perfect for kids to experience a bit of rural life in the heart of the city. For an older audience, you may want to go to this unique experience of The Viktor Wynd Museum of Curiosities. Hackney is also brilliant for social outings with many bars and restaurants at your fingertips.
Living in Hackney comes with a warming, strong community that prides on its diversity. If you are a First Time Buyer in London looking for an exciting employment opportunity, this area is perfect for finding your dream job and is commutable to the centre of London and is home to many brands and head offices. From modern apartments to historic terraced houses, Hackney has a property for everyone!
Get in touch with a reputable Mortgage Broker in London like us to explore your option on starting your mortgage journey in Hackney.
Situated on the banks of the River Thames, Greenwich provides a picturesque landscape full of history and green spaces. It’s also famous for its naval and military connections.
The area is known for being one of South London’s most attractive places to live. There is a large number of properties available in the area with varying price ranges. If you are looking to grow a family or currently have one, Greenwich has many schools dotted around the area both public and private with primary and secondary schools also.
Living in the capital means you are spoilt with job vacancies that provide fantastic opportunities. There are also many nurseries if you are in need of childcare. One thing to keep in mind when it comes to commuting is the charge to drive in and around the city, however, there are brilliant transport links including the underground and the bus.
Greenwich is perfect for your amenities. There are plenty of high street to independent shops around the area for your weekly food shop. As mentioned, the area is full of green spaces including the well-known Greenwich Park which is perfect for a daily walk.
Rich in history, Greenwich has many museums highlighting their maritime history and its brushes with royalty. Furthermore, it can be a perfect night out with lots of pubs, restaurants and bars spanning across the area.
If you are interested in moving home in London or are looking to get on the property ladder as a First Time Buyer in London and Greenwich sounds like the place for you, we can help. Get in touch with us and your Mortgage Advisor in London will help you get started on your property venture in Greenwich.
All kinds of homeowners are drawn to Battersea. Its flourishing culture, desirable Victorian and Edwardian properties are enough reasons to move into the area. From the local markets to green spaces, attractions are never in short supply in Battersea.
A strong stable of steadfast restaurants is peppered with a brace of culinary start-ups looking to become firm favourites. It’s easy to spend a whole day strolling beautiful Battersea Park and its gardens, looking out across the lake, and perusing the eateries.
With a population of over 70,000 residents, Battersea has plenty of transportation links. This includes a local underground station, connecting Battersea to the Northern line. Battersea Park Train Station also offers a quick route into the capital, taking several minutes to reach Victoria train station.
Since you are on the river, you’ll be able to take the RB6 water taxi, operating between Putney and Blackfriars, which stops at Wandsworth Riverside Quarter. Alternatively, you can hop onto the Thames Clipper with regular services into central London between Battersea Power Station and Tower pier – whatever floats your boat! There are also plenty of buses around the clock too. Battersea is full of schools offering both primary and secondary education which is perfect if you currently have a family or are looking to start one.
If you are looking for open and honest Mortgage Advice in London to get started on obtaining a mortgage. We offer all our customers a free mortgage appointment where you can speak to one of our expert advisors on your mortgage goals.
Although Kensington and Chelsea are smaller than other London boroughs, they are amongst the most affluent areas and are described as “the centre of London’s high life”. In terms of properties, you are spoiled for choice! Over the years, the central location, architecture and design of the area, and access to high-end amenities have transformed Kensington and Chelsea into one of Britain’s most expensive residential properties, with some of the highest prices in the capital.
Nevertheless, if you choose to live here locally then you’re in luck, South Kensington is home to three of the country’s most popular museums – the Natural History Museum, the Science Museum, and the V&A. All are within a short walking distance, and offer free admission; perfect for history lovers.
There are plenty of eateries and a variety of shops across the borough. Whether you’re enjoying exploring the latest trends at the artsy Kings Road scene, picking up a rare find at the Portobello Road antique market, or enjoying some retail therapy in the boutique concessions of Harrods, the shopping experience in Kensington and Chelsea is one of a kind.
Any families looking to move into the area will be happy to know there is a huge variety of schools to choose from. From public and private institutions to schools that offer help and support for children with learning difficulties or disabilities, you can rest assured that there’s a school to suit everybody’s situation.
Whether you are a first time buyer in London or Home Mover in London, if you’re considering locating to Kensington and Chelsea, and you want to discuss your mortgage options, get in touch with a member of our expert Mortgage Advisors in London today.
If you have been doing your research on the world of mortgages or more specifically have been having a look at what your potential options for taking out a remortgage in London, you may have come across the term “capital raising” before.
Understandably, some may be confused as to what capital raising actually is. Simply put, capital is money, which means that capital raising is the financial terminology for the act of raising money.
There are a variety of different ways that this can be achieved and it is used for all manner of reasons.
As a general theme amongst conversations we have with existing homeowners, is that they would not only like to remortgage, but they would like to do so as a way to release equity for things like home improvements, to gift a deposit or something else.
If you are not too sure what equity is; Equity is the difference between your remaining mortgage balance and the amount that the property is valued at.
If during your term your property has increased in value, rather than enquiring about a remortgage to release equity, you may have the option of utilising something called a further advance.
This type of mortgage allows homeowners to take out an additional mortgage on their property to borrow an additional amount, as a way to release a portion of equity they have built up over time.
Further advances are typically taken over longer terms and have lower interest rates than standard personal loans, though you will also have to bear in mind that you will not only be paying back your primary mortgage, but also this as well.
Both these mortgages are separate from one another, the further advance is not added onto the first mortgage. This is two individual mortgages with the same lender, on the same property, with their own interest rates.
This mortgage type is something that can be a really good option for homeowners who perhaps don’t wish to remortgage or are tied into a deal so can’t remortgage. Remember the risks though, one of which being that there will be a higher risk of repossession if you cannot keep up your payments.
A second charge mortgage is a little similar to a further advance, allowing you to once again having another smaller mortgage running alongside your existing one, allowing you to release some equity.
The biggest difference between a second charge and a further advance, is that second charges are actually with a different mortgage lender and also have different interest rates.
If you were in an unfortunate circumstance where you were faced with repossession, your initial mortgage lender will be paid back from your homes sale, with any funds remaining from that sale then going to the second lender (but again, only after the first mortgage lender is completely paid back).
There are quite a few different reasons as to why you may find yourself in the market for something that allows you to capital raise against your home.
Popular options for achieving this include to fund any home improvements you would like to make, such as an extension, new home office or maybe even loft/garage conversions. We also often hear people wanting to consolidate unsecured debts against their home.
Other instances where a homeowner may look to capital raise, is to perhaps gift a deposit to their children so they can get onto the property ladder, to buy a second home/property (common with those looking to start with a Buy to Let in London), and to pay for larger purchases.
If you have any portion of equity sitting within your property and are in the market for a capital raising mortgage, then you could be most suited for a remortgage to release equity. Of course our trusted mortgage advisors in London will make sure this is right for you before proceeding.
Book your free mortgage appointment and we will review your case to determine the most appropriate course of action. If a remortgage isn’t right for you, there may still be an alternative that fits what you are looking to achieve.
If you are aged 55+ and have a property worth at least £70,000, you may find yourself better suited for the option of equity release in London.
To understand the features and risks of equity release, ask for a personalised illustration. Our typical advice fee is up to £1,495 only payable on completion.
A lifetime mortgage may impact the value of your estate and it could affect your entitlement to current and future means tested benefits. The loan plus accrued interest will repayable upon death or moving into long term care.
** With Debt Consolidation there are some risks to bear in mind. That is why we always recommend you speak with a qualified Mortgage Advisor in London, before you look at consolidating any unsecured debts against your property.
The Financial Conduct Authority does not regulate some types of commercial or buy to let mortgages in London.
When it comes to the world of mortgages, there are many different routes that a property purchaser can take. From first time home buyers making their first steps onto the property ladder, to homeowners remortgaging, as well as holiday lets and even HMO’s, there’s a lot you can achieve!
One particular mortgage area that we frequently encounter when we speak to customers, is for a buy to let mortgage in London.
A buy to let in London will be classed as an investment property; You are prohibited from personally residing in it, it is solely there for profit. If you have privately rented previously, you will have likely been living in a property with a buy to let mortgage attached to it.
In order for a property to count as a buy to let in London, it has to be intentionally mortgaged as such, with the landlord making clear their plans to rent it out. The tenant will pay a monthly rental cost, that should be able to cover the monthly mortgage costs, plus a little more.
There are a lot of different areas that you can look at, to figure out whether or not you are eligible for taking out a buy to let mortgage in London.
Some of these factors can include what type of property it is that you are looking to buy, how old you are (there will typically be a limit of between 21 and 75, with mortgage lenders who work past 75 for a buy to let in London being limited), as well as your buy to let landlord experience.
The biggest factors that will be looked at by a mortgage lender are your affordability, the minimum deposit requirements and the current status of your credit score.
So that you can prove order to prove your eligibility for taking out a buy to let mortgage in London, you must first prove your affordability to the mortgage lender. The vast majority of mortgage lenders will have their basis for this centered around your projected rental income.
Projected rental income is the amount that your mortgage lender feels you should charge in rent, in order to cover all of your monthly mortgage payments, plus additional funds. They will have a specific requirement for this, and the mortgage lender will calculate it using the properties value.
As well as using what they deem is the projected rental income, some buy to let mortgage lenders will also have their own minimum income requirement, which is typically around £25,000, though this is entirely dependent on the mortgage lender you will be borrowing from.
An expert mortgage broker in London with experience in working with buy to let mortgages in London, such as our team here at Londonmoneyman, will help you find the most suitable mortgage lender for your plans and on the most suitable mortgage deal.
As will generally be standard with most purchases, you must put down a deposit for your buy to let mortgage in London. Typically speaking, the minimum for this is around 20-25% of the value of the property, though this can differ depending on your mortgage lender.
This is so that the mortgage lender has a reduced risk. By having a much higher deposit, you’re borrowing less funds against your property. This in turn will open you up to between a 75-80% loan to value, which gives you access to much better interest rates.
If you do fall into the category of a high risk purchase, say if you’re looking to take out a buy to let mortgage in London with bad credit, you may be asked to put down a deposit that is even higher than that.
You may be eligible for taking out a buy to let mortgage in London if you have a low credit score or a history of bad credit, though your choice of mortgage lenders will be greatly reduced. There are plenty out there, who may not even lend at all to someone with bad credit.
For the mortgage lenders who are still willing to help customers in these kinds of situations, they will be looking at factors such as, how serious your bad credit actually is and why it is that way. You may also be required to put down a bigger deposit.
Before you make an application for a buy to let mortgage in London, you will of course first need to find a property you would even like to make a purchase on.
Once you have done that, book a free mortgage appointment and speak with an expert buy to let mortgage advisor in London, as they can confirm whether or not you are eligible, find the best deals out there for you, and find you a mortgage agreement in principle.
Following this stage, you will have the freedom to go and make an offer on that property, which will kickstart your full mortgage application process, providing you have had your offer accepted.
As a general rule, you will find that buy to let mortgage investors will take out their buy to let in London as an interest only mortgage. This means you only pay the interest per month, drastically lowering your monthly outgoings.
Once your term has reached its conclusion, you will owe the capital balance that remains. This is usually either paid off by selling the property or taking out a remortgage and moving it onto a repayment mortgage. You may also be required to set up a repayment vehicle, in order to cover the cost.
Whilst an interest only mortgage tends to be the more tax-efficient and popular of the mortgage types for a buy to let in London, you are still also able to take out repayment mortgages on your properties. This means you will be paying a combination of capital and interest per month.
Though this of course will increase your monthly mortgage payments, it will mean that equity can grow within your property. At the end of your term, you would own your property outright, without the need to make any capital payments back to the mortgage lender.
As mentioned previously, a mortgage lender will want to stress-test your projected rental income, to review the amount you need to be charging in rent, so that you are able to cover the cost of your monthly mortgage repayments.
In terms of the amount that you would like to borrow, as long as your projected income can cover the amount that you are asking for, you will typically not be limited. That being said, a mortgage lender will want to see your projected rental income is more than your monthly payments by a certain amount.
For you to be able to apply for a buy to let mortgage in London, you will also need to give your mortgage lender a selection of documents, before you proceed. These usually include, proof of your income, deposit, ID, address, any bonuses and commission, as well as your current or most recent P60.
If you are a self employed mortgage applicant, you will generally need to provide your SA302 tax returns. Existing landlords may also be required to give proof of rental income, which usually comes in the form of an ARLA-regulated report, as well as a mortgage statement of all your existing properties.
By making sure you have as much of this with you as you can, ahead of taking out a buy to let mortgage in London, you will find that your mortgage application progresses much quicker than it otherwise would have. It is definitely within your best interests!
Of course, much like there would be with any mortgage, you will have basic costs involved. You will obviously need to put down a deposit, so that is a larger cost. Then there are mortgage arrangement fees, application and broker fees, as well as monthly mortgage payment costs.
On top of this, you may also have other fees that you will need to pay. Some of the more frequently encountered fees you will have to pay, include valuation fees, product fees and mortgage exit fees. Additionally, there may be solicitors fees and disbursement fees, as well as stamp duty.
Your open & honest mortgage advisor in London will be able to provide more accurate advice on the potential stamp duty rates you will be paying. If you ever wish to exit your buy to let in London early, you may have to pay an early repayment charge (ERC), which may be quite expensive.
Lastly, you will have to think about the types of costs that will go beyond what you would be already paying. Landlord insurance is also something that you will have to think about, as well as any letting agent fees, income tax and the general upkeep of the property, such as making repairs.
All the different costs included with a buy to let mortgage in London can be different, depending on mortgage lender, as well as your own personal and financial situation. Not all of these will be factored, though your mortgage advisor in London will make sure you are aware of every cost involved.
Yes, you will almost always be able to remortgage a buy to let in London. We typically see landlords looking to take out a buy to let remortgage in London as a way of releasing equity from the property, with the intention of putting a deposit down on another property.
The equity that is in your buy to let property will work a little differently than a standard residential property, if you currently have an interest only mortgage. Normally your balance and the interest will come down together, creating a much larger gap between value and balance.
When you have an interest only buy to let in London, only the interest will decrease. That means the equity in your property depends on how much deposit you put down and what the value of the property now is. Speaking of interest only mortgage, you may wish to also pay the capital balance as well.
To achieve this, you would be remortgaging your interest only buy to let mortgage in London onto a repayment mortgage, which would increase your monthly mortgage payments but give you the option of paying both capital and interest at the same time.
Though you may have limited options, it may actually be possible to get a buy to let mortgage in London as a first time buyer in London. When you look at first time buyer buy to let mortgage options, your deposit will likely need to be bigger, so that you can borrow the amount you need.
Additionally, please also bear in mind that in doing this, you would lose out on other benefits that first time buyers would get, such as stamp duty, because it is not a main residence for you and generally, buy to let landlords will be paying stamp duty.
For many first time buyers in London, becoming a landlord can actually be a really useful way to give a boost to your income, prior to affording a mortgage of your own on a residential property that you would like to live in.
Always remember that in situations like these, a mortgage lender will assess you on your second purchase, knowing that you already have a mortgage to your name, which in turn could affect future affordability or reduce how much you could borrow.
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Londonmoneyman.com & Londonmoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is Registered in England, No. 6789312 | Registered Address: 10 Consort Court, Hull, HU9 1PU.
Authorised and Regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No. 627742 at www.register.fca.org.uk
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Londonmoneyman.com & Londonmoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is Registered in England, No. 6789312 | Registered Address: 10 Consort Court, Hull, HU9 1PU.
Authorised and Regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No. 627742 at www.register.fca.org.uk
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