Buy to Let portfolios

Overview

Over the last few years, Companies and private individuals have considered buy-to-let mortgage schemes as an alternative form of investment. A buy-to-let mortgage is a loan for a company or individual to purchase a property for the express purpose of renting it out. Many people see buy-to-let schemes as an alternative to a pension.

There are pros and cons associated with any business or property venture, so it is best to plan carefully and to speak with a professional advisor before taking the plunge.

What is a portfolio ?

A Portfolio is usually where an individual or company owns more than one investment property. Some lenders will offer a portfolio facility. This is where usually 3 or more properties are mortgaged or re-mortgaged at the same time, this can:

1. Provide a better rate as the total lending is a total of the individual mortgages
2. Enable value and rental offset - you can use properties with higher rentals to support those with lower rents and visa versa thereby increasing the total amount you can borrow.
3. Provide a forward buying facility. Although you may not want to borrow the maximum allowed on day one you could be offered a facility at the maximum permissible. This would allow you to purchase at auction or make quick offers to facilitate an attractive purchase. You do not have to keep going back to the lender on a property by property basis.
4. Provide greater flexibility for the professional landlord. Lenders usually consider that a landlord who has 3 or more Buy-to-let properties to be a 'Professional Landlord'

Some factors to think about before making your decision:

Type of property

Analyse the market and identify what is important to you. Is your objective high capital growth or high rent. The answer to this depends upon your investment objectives and how you will finance the purchase. You need to find a property that suits your rental market. Also make sure that the property will be low-maintenance and will not require a lot of repair work, unless of course refurbishment is part of your capital or rental growth objectives. You may wish to purchase or build a mixed portfolio giving you a balance between income and capital growth.

Availability of Finance

Before committing to purchase a property, (especially if you are going to auction) you will need to have sufficient finance available either out of your own savings or with the help of a mortgage lender. Given the number of lenders available and the different scheme types you will find it beneficial to seek advice from a qualified mortgage advisor.

Ring us now for further information and assistance

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

Our fees are usually up to 1% of the loan amount depending on your circumstances. Typically this will be £361 plus a £100 administration fee.

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

Buy to let mortgages are not regulated by the Financial Services Authority.