Buy To Let Mortgages

Buy to​ Let Mortgages
As far as​ investments go,​ property is​ one of​ the​ safer bets .​
Buying a​ house to​ let out can be a​ safe and profitable way to​ put spare cash to​ use,​ and a​ good way of​ expanding your assets .​
While some approach letting as​ a​ purely commercial exercise,​ parents may also buy a​ place for their children,​ which they then charge them rent for .​
This can be seen as​ investment in​ both your and your family’s future.
Mortgages available for letting property used to​ be subject to​ higher rates of​ interest than standard residential mortgages,​ but in​ recent years this has changed .​
In an​ active attempt to​ encourage growth in​ the​ private rental sector of​ the​ market,​ interest rates have been lowered and criteria made more flexible .​
This led to​ a​ boost in​ the​ amount of​ properties being bought as​ income-producing investments.
The Association of​ Residential Letting Agents (ARLA) run the​ Buy-to-Let initiative,​ designed to​ encourage private investing in​ the​ letting market .​
Taking on​ an​ agent can help boost the​ confidence of​ your lender that you​ know what you’re doing – a​ letting agent will advise you​ on​ suitable property and how to​ manage it .​
Under a​ bonding scheme that members of​ the​ ARLA belong to​ they can also provide compensation if​ there’s a​ problem with rent or​ deposits.
The rent you​ charge,​ as​ a​ rule of​ thumb,​ should be around 150% of​ your monthly mortgage repayments .​
This should cover all the​ associated expenses – while letting can prove profitable you​ should take into account the​ time and cost involved .​
Not only will you​ need to​ find and purchase suitable property,​ but you​ will have to​ manage it​ well,​ whether this means maintenance,​ furnishing or​ advertising .​
An agent can take care of​ some of​ these tasks,​ but bear in​ mind you​ will have to​ pay their fees .​
Generally,​ you​ should think of​ buying to​ let as​ a​ medium or​ long term investment.
You should always make sure that a​ professional agent or​ solicitor draws up leases and agreements .​
While you​ can buy ‘readymade’ leases,​ these are not comprehensive enough to​ rely on​ .​
Remember too to​ include an​ inventory of​ all furnishings and fittings in​ the​ property .​
Other costs to​ consider are: Insurance – both buildings and contents,​ plus you​ may want to​ take out rental protection in​ case a​ tenant fails to​ pay .​
Service charges and maintenance costs – try to​ ensure the​ property will require the​ minimum of​ upkeep and repairs.

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