Buy To Let Remortgage
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What is a Buy to Let Remortgage?
A Buy to Let Remortgage is like a traditional Remortgage on a residential property. However, the only difference is that you are Re-mortgaging a Buy to Let Property. Generally to help with cashflow and Monthly Budgeting, a majority of Buy to Let Mortgages are taken out on a Fixed rate. Usually 2, 3 or 5 years.
After this rate expires, the Mortgage lender will usually transfer your mortgage to their Standard Variable Rate (SVR ). This rate is generally higher, meaning that your monthly payments will increase.It’s best to call your broker 3 months before the expiry time. This in order to give them enough time to source the best deal and take you to a Lender who is offering you better rate.
As this market place is very competitive, you will find Lender offering Free Valuations. Similarly in some cases they also offer Free Conveyancing. Therefore this means that a Remortgage could be done with minimum costs.
To summarise, a Buy to Let Remortgage is the process of moving your Mortgage to an alternative Lender with a view of getting a better rate.
Remortgaging to expand your Portfolio
One of the primary reasons for a Buy to Let Remortgage is to release cash from your existing property or properties to help purchase an additional property.
This can be done in various ways and the right choice depends a lot on the deals available at the time.
Read more How do I Remortgage my Buy to Let Portfolio
Renovating and improving the property
Buy to Let Landlords are very heavily regulated. Equally they are under constant pressure to look after their property to fit in with latest Guidelines. As a result, renovating and improving the housing stock is part of a professional landlord’s job title.
Many Mortgage Lenders approve of releasing cash from your existing property through a Remortgage to improve your property. This not only helps a Landlord to meet their Legal Obligations, but also helps to getting a better type of tenant .
Therefore this is a win – win for all Parties.
Paying other debts
Debt Consolidation using a Buy to Let Remortgage is not uncommon. However any Debt Consolidation is fraught with risks and should not be taken lightly
Pros
- The rates offered from a Buy to Let Remortgage could be better than the debts you plan to clear and will save you in monthly interest.
Cons
- You could be increasing the term of the Debt. For example, from a 10 year Personal Loan to a 25 year Mortgage, thus ending up paying more in interest charges.
- A Personal Loan or Credit Card is unsecured (no charge on your property). Mortgages are always secured on your property, so you will changing your debt from unsecured to secured. Although, if you do not keep up your Payments your house could be repossessed.
Therefore, it’s important to have your debt management strategy laid out before risking your property to clear other debts.
We can work with you to make sure that your debt repayment strategy is sound and done for the right reasons.
Can I Remortgage a Buy to Let with Bad Credit?
Yes we can help you to Remortgage a Buy to Let with Bad credit. However due to the risk to the Lender you will pay a higher interest rate.To point out, the interest rate charged will depend on the type of Bad credit you have or had.
For example; Defaults on your account 5 years ago will have less impact on the rates, however a CCJ registered 5 months ago will mean higher rates.
We have several Lenders that look at a Bad Credit Buy to Let Remortgage
Factors to consider your buy-to-let remortgage
As with any type of lending you will have to undergo the same financial checks as when you first make a Mortgage application. This includes a full credit check and affordability assessment.
So it is important that Landlords at any given time have a good :
- Credit Score
- Cash-flow
- & Well maintained Property (meeting all legal obligations)
This will mean that a Landlord can have a pick of the best Buy To Let Lenders and the best rates.
Other factors will include:
- Type of tenancy. Are they professional, families or students?
- The reason for your Remortgage. Are you borrowing additional money?
- The monthly rent from the property
- Some Lenders ask for proof of personal income
- The Loan to Value (LTV). The lower the LTV, the better the rates
- When lending to Portfolio Landlords some Lender will want to see a full Property Schedule showing details of all existing properties
Why Us
- Raising The standards of financial advice
- Making financial advice accessible to all
- Trusted & stress-free financial advice
- Friendly, personable advisors
our Mortgage Butler service
Help you to collate all of the documents you will need to apply for a mortgage
Complete and submit your application
Handle all the enquiries by the Mortgage Lender
Liaise with your Estate Agent
Help you to nominate a good & competitive solicitors
Work with all the parties to get you to Mortgage completion
Keep in touch with you on a yearly basis and help with your future needs
