The 85% range of buy to let mortgage products has deminised in recent years and is now slowly starting to make a come back. If you would like a detailed view of the all the buy to let mortgage options then click here to access the comparsion service by The Lending Expert.
An expanding range of lenders
More Buy-to-let mortgage lenders are expanding their range and willing to lend on 85% loan to value (LTV). This means that as an investor you can buy your property for a small deposit of just 15%. While these types of mortgages are more expensive in terms of rates charged and arrangements they are very popular with first time landlords and property investors.
What are your finance options?
These types of mortgages are poplular with new investors, however they are expensive when compared against 80% and 75% mortgages. The arrangement fees are often quite high and so are the ongoing rates of interest. However, they do provide a lifeline for new investors who are keen to get going and can only raise the minimum amount required. If you are purchasing a property at below market value or a property that you are able to add value to then there is always the option to remortgage to a new 80 – 70% deal later on.
Caution for new buy to let investors
New investors should be cautious when buying a BTL property for the first time to ensure that the investment stacks up and there will be a return not only to pay the mortgage, but also provide additonal funds to carry out maintenance work that may be required throughout the lifetime of the investment.
Often new property investors will rush in with excitement to buy, without fully considering and understanding the risks and costs with owning a buy to let property. Being a landlord and owning buy to let property can be expensive if mistakes are made or you buy the wrong type of property in an area with low tenant demand.
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What products are there?
There are only a handful of lenders offering buy to let 85% mortgages that you could probably count on one hand. However the market is constantly changing and we’d recommend using a good comparison site to keep upto date with the constant change in the market place.