Most Let to Buy mortgage lenders will offer a mortgage with up to a 75% LTV ratio. This means you will need to retain a 25% equity in the property even after accessing available equity to help fund the next property purchase. There might be some exceptions in the current market, which you can discuss with our Let to Buy mortgage advisers.
Let to Buy mortgages
Let to Buy mortgages are a unique financial solution for homeowners looking to rent out their current property while moving to a new one. Our specialist purchase mortgage team are experienced in Let to Buy arrangements and can guide you through this complex area.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Speak with a Let to Buy mortgage adviser now and let’s get you moving soon!
Get in touch
Get in touch
Informed decision making
Tailored insights, informed choices
A Let to Buy mortgage is taken out on your existing property when you wish to start renting it out to tenants. The rental payments you receive will help cover the monthly mortgage repayments. A Let to Buy mortgage could also simultaneously allow you to access available equity in the property, which you can use as a deposit to buy a new property. This is what gives these mortgages their name. Alternatively, Let to Buy mortgages might be used when a couple own separate homes but wish to move in together. These types of mortgages are especially beneficial if you’ve struggled to sell your property and wish to move quickly, or if you need help funding the deposit for your next home.
- Call: 0115 870 9520
- Email: [email protected]
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Personalised Let to Buy advice
The right Let to Buy mortgage for you will depend on individual factors, including property goals and personal preferences. Our Let to Buy mortgage advisers always provide a tailored service based on your specific situation.
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Smooth and streamlined process
We aim to make the Let to Buy mortgage process as smooth and stress-free as possible. We do this by answering all your questions, handling applications and supporting you with documentation requests from lenders.
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Capital growth potential
Renting out your existing property as opposed to selling it could be financially beneficial in the long run. If the value of the property increases, you could generate a greater profit when you decide to sell in the future.
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In-depth financial assessment
By carrying out an in-depth assessment of your financial circumstances, including your existing property and mortgages, your intended purchase and your overall objectives, our qualified advisers will be able to give you carefully tailored advice. Let to Buy need not be a pipe dream.
Navigating complex regulations
James Leighton stays abreast of the latest and upcoming regulation changes, ensuring you have the right knowledge to make informed decisions.
Things to consider
Insurance requirements
When you let your property, you’ll need to switch to a landlord insurance policy which can be more expensive than standard home insurance. Ensure you’re adequately covered for property damage and liability.
Things to consider
Tax considerations
When considering a Let to Buy mortgage, it’s important to understand the tax implications. Any rental income you receive will be subject to income tax. However, certain property expenses can be deducted from your rental income for tax purposes. Furthermore, if you sell the property in the future and make a profit, these profits could be subject to Capital Gains Tax. Always consult with a tax adviser or legal expert to understand the full implications based on your specific circumstances.
Tax treatment varies according to individual circumstances and is subject to change.
Things to consider
Calculating capital
To assess the viability of a Let to Buy scenario, you first need to calculate the potential capital that can be raised. This involves evaluating the equity in your current property and the amount you could potentially borrow against it. Remember, lenders typically require a higher deposit for Let to Buy mortgages, often around 25% of the property’s value.
Maximising your options
How loan comparison enhances Let to Buy mortgage decisions
Let to Buy is a complex area of lender criteria, especially when a mortgage is required for the onward property purchase. As a Whole of Market brokerage, our highly experienced team of mortgage advisers have access to a huge range of more than 90 lenders and 1000s of deals, in addition to a range of exclusive products offered through our mortgage network, Quilter Financial Planning Limited which means that we’ll be able to maximise your options when it comes to sourcing a great Let to Buy mortgage.
- Call: 0115 870 9520
- Email: [email protected]
FAQs
Q
What is the maximum Loan-to-Value ratio for Let to Buy mortgages?
A
Q
Can I use the equity in my current property to buy a new home with a Let to Buy mortgage?
A
Yes, many homeowners use a Let to Buy mortgage to access some of their available equity, which is then used to contribute to the deposit for their next property purchase. There are pros and cons of accessing your equity, which our advisers will discuss with you and answer any of yout queries.
Q
What are typical interest rates for Let to Buy mortgages?
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Let to Buy interest rates are subject to change and vary depending on current market conditions. However, you should expect Let to Buy interest rates to be comparable with Buy to Let mortgages. Our advisers can discuss current market conditions, so you have realistic expectations entering the mortgage market.
Home movers
Whether you’re upsizing or downsizing, our mortgage advisers can help you find the most advantageous mortgage option.
New build mortgages
Navigate the new build mortgage market with our experienced and well-connected new build mortgage advisers.
Remortgaging
Our advisers will look to help you find a better mortgage deal with our results-driven remortgaging advice and brokering services.
First-time buyers
As a first-time buyer, you’ll receive a personalised mortgage advice service, clear explanations and exceptional patience throughout the process.
25%
is the average deposit you'll need to secure a Let to Buy mortgage*.
To qualify for both mortgages, you must meet the lender's affordability criteria, including having a good credit score and proof of income.
*Source: https://hoa.org.uk/advice/guides-for-homeowners/i-am-selling/let-buy-mortgages-explained/
Sam Chung - Senior Mortgage Adviser
“Using our expertise and determination, we help our let-to-buy clients reach their financial dreams by providing tailored solutions.”
Sam Chung is a seasoned team member. He's passionate about finance and dedicated to making a difference in our clients' lives.
- Call: 0115 870 9520
- Email: [email protected]
Case study
Let-to-buy with a complex income
Client background: Our clients were looking to relocate and purchase a new residential property. They already owned a property which they bought using the Help to Buy scheme but didn’t want to sell it. In an ideal world, they wanted to be able to let the property out.
The challenges:
- The clients had complex income as one was a bus driver, with a large amount of variable income - including night shifts, weekends, lates and morning rates. Due to a recent accident, their year-to-date figure didn’t accurately reflect their income.
- The clients wanted to port their current mortgage in order to retain their existing low rate and save on their Early Repayment Charges (ERCs).
- The clients were hoping to be first-time landlords and therefore needed to maximise the amount they could take out of the property due to having to repay their Help to Buy loan.
- The clients were relocating 120 miles away.
What we did:
- We arranged to port their existing mortgage to the new property. Although the case didn’t meet standard affordability, we managed to get an exception from the lender based on providing two years’ P60s.
- We sourced a lender that would allow the clients to take their Loan to Value (LTV) to 80% on their current residential property, thus maximising the amount of money they could withdraw to purchase their new home.
To wrap it up: As first-time landlords, we were limited with lenders that were happy to remortgage the property. Based on the great rental income the clients would receive, we were able to release up to 80% of the property value, meaning the Help to Buy loan could be repaid without any additional funds from the clients.
To port the existing mortgage, we had to apply to the lender for an exception what with the case not meeting normal affordability. Due to health reasons, one client had had to take some time off work, meaning that two of their three payslips didn’t show any additional enhancements. Based on their income history, we were able to put a case forward to the lender for an average of the last two years’ income to be used. This meant the clients could port their existing mortgage and therefore incur no Early Repayment Charges (ERCs).
We were able to put a case forward to the lender for an average of the last two years’ income to be used.
What our customers say
My let to buy Mortgage applications were extremely complex and i gave up many times during the process. Sarah was exceptionally professional and she kept me going and finally she got me 2 mortgages at very good rates meaning i can move to my dream new home and let out the current home am over the moon. Every single person i dealt with at James Leighton was very professional and guess what all this service was free. Guys i cant recommend you enough.
Thanks a million
