Criteria for BTL Mortgages
There are a number of criteria for buy to let mortgages that you will have to fulfill if you want to secure the money and become a landlord. This commitments and criteria are spread between a numbers of different groups but are essential to avoid some fairly major problems later on down the lane.
Firstly, your mortgage lender will be looking for a measure of stability from you. This will usually equate to having a steady income and putting some form of deposit down.
Secondly, there are a number of criteria for buy to let mortgages and taxation. You will be expected to pay income tax on the rental income and your lender will have expected you to factor this in to your calculations regarding the proposed buy to let mortgage deals.
There are also a number of legal criteria you will need to meet, including:
- Meeting fire and furnishing regulations
- Make sure that you have a had a gas check and that the electrical fittings are in good order
Apart from the legal and taxation criteria above, a buy to let mortgage will be successful if a number of other important factors are considered carefully.
Choosing the right buy to let mortgage deal for your specific situation is vital. Most lenders will only permit you to borrow around 85% of the value of the property, and as a general rule of thumb it is thought that to be secure, your rental income should cover around 120% of your monthly repayments.
A final criteria should be the issue of insurance. You might want building and contents cover as well as cover for the non-payment of rent. With these things in mind you should take a look at our comparison tables, which feature a number of buy to let mortgage deals.