Best Mortgage For Buy To Let

Buy To Let Mortgages

If you just starting out in the property investment market and completely bemused as to which type of mortgage to choose for your buy to let property, there are specific mortgages for Property Investment - i.e. to rent out rather than live in - you will need a buy-to-let (BTL) mortgage.

Buy to Let mortgages are unique and quite different from the mainstream mortgages as, instead of assessing the amount you can borrow from a lender, based on your income, loans are calculated on the rent you could get for the property.

In the past mortgage lenders required a rental coverage that was above that of the mortgage amount, for example 120 % of the monthly repayments. But lately the rules have become more relaxed and you can get a mortgage with rental coverage of 100 per cent in some cases. The credit crunch is seeming to work in favour of the property investor compared to the standard residential mortgage.

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However, it is still usual practice to have to raise a deposit of 10% or more, but more recently the number of No Money Down deals have populated the market.  Traditionally only a small number of specialist lenders offered BTL mortgages but more recently we have seen high street banks start to lend to landlords.

BTL mortgages can normally be either repayment or interest-only loans. Interest-only mortgages mean cheaper monthly payments but the property will not be yours at the end of the term – you will still need to repay the capital amount or sell the property. Repayment mortgages ensure that you repay a bit of the capital and a bit of the interest each month and at the end of the term the debt is fully paid off.

If you have have ambitions in the Property Investment martet and would like to find out more information about Buy-to-Let mortgage option you can register for a Free property Investment Workshop in your area.

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5 Reasons Why Houses Prices Are Falling

Why Are House Prices Falling

The housing market in the UK is in freefall currently, in stark contrast to the buoyant property market scene of just a few years ago. But why are house prices falling and are you concerned about the negative equity that your home presents you with.

Throughout the nineties and midway through the 21st century the UK property market enjoyed its biggest ever boom. Our homes it would seem were our biggest asset. This though was a false sense of economy as most would never realise the equity in our homes as to move would negate the profit gained.

1. House Prices Are Unaffordable To First Time Buyers - First time buyers are finding it increasingly difficult to get onto the first step of the property ladder as the average house price to earning ratio are now poles apart.
2. Mortgage Lenders Are Not Approving Finance - The phrase Credit Crunch applies to the mortgage industry more than any other. Applications for mortgages are fewer and more mortgage applications are being rejected.
3. Interest Rates Increasing - Interest rates are increasing with velocity, the average monthy mortgage repayment has risen by 30%. This effects first buyers and low wage earners who are now in danger of repossession.
4. Unstable Economy - Any rumour of an unstable economy and one of first industries to be hit is residential property market.
5. What Goes Up Must Come Down - the last decade of phenomenal growth had to slowdown sometime, an initial slowdown is viewed as a negative - the knock on effect is panic, reduction in consumer spend and eventually a credit crunch situtaion.

Is Now A Good Time To Invest In Property

If you intend to move house or buy a property for the first time for the sole purpose to live in it may be wise decision to not do anything yet. House prices will probably continue to fall for the forseeable future - then recovery is expected.

For the property investor now is the perfect time to invest in property both residential and commercial. The Buy To Let market will increase dramatically as tenants will outnumber available property.

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Is Buy To Let Still A Good Investment

Buy To Let Investments In The UK

With interest rates rising, inflation going through the roof and mortgage lenders becomming fussier by the day is buying to let still a good investment?

The UK property market is under pressure and the media tells us our are homes are under threat throughout this latest period of economic doom - the Credit Crunch is truly taking a hold.

So what of the entrepreneurial spirited who either has one or more buy to let properties and one or more buy to let mortgages is it time to press the panic button and bale out - if they can.

Most of the buy to let ‘ers we have spoken to remain relatively calm it is not as if they have lost the lot on one spin of the roulette wheel.

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Any invetsor will tell you the high’s and low’s are part and parcel of the property investment game. “It would have been good to sell some properties at the start of the decline but hindsight is a luxury we do not have.” says David Forster a home based property investor. “I got into the property investmarket at the beginning at 2003 when mortgage lenders where literally throwing money at investors - times have changed now but experts predict the good times will be back. It is just a case a riding the strom. While house prices are in decline, now is good time to buy again”

The Future Of The Buy To Let Property Market

At the time of writing the buy to let market is becomming one where only the strongest or smartest will survive.

Mortgage lenders are removing buy to let products at an alarming rate - it is estimated that only 25% of buy to let products are still available in comparison with this mid 2007 many mortgage companies have now withrawn products and lenders are asking for much higher deposits.

The one man band type property investor working alone will suffer with the experienced multi property owners will still able to keep thier heads above water - but only just.

With house prices expected to hit rock bottom sometime soon the only way is up. The smart investors are ready to pounce.