Residential Mortgage v buy to let mortgage

[hatter]

Ring up your lender and ask them their policy. They will probably want to sell you a BTL mortgage but persist. Good luck.

Thanks.

Just spoken with the lender and they werent as difficult to deal with as I had envisaged. They said there are a few questions I would need to answer, pay a £100 fee and then they look at each case individually. At least it wasnt a definate "no" from the start.

[mooshld]

I am with Nationwide and it was a similar thing I informed them when I was going to do it they charged me a nominal fee. Done deal.

However they have since changed their policy and you can stay on the same mortgage but they are charging an extra 1% interest to cover the apparent extra costs of these types of mortgages. When I asked them to detail those costs of course they couldn't so I requested for them to find them and send me a detailed break down. Of course they have not done that either.

Wish they would just be honest and say we are charging more because we can and there is nothing you can do about it.

[geoff from contracta IOM]

I am with Nationwide and it was a similar thing I informed them when I was going to do it they charged me a nominal fee. Done deal.

However they have since changed their policy and you can stay on the same mortgage but they are charging an extra 1% interest to cover the apparent extra costs of these types of mortgages. When I asked them to detail those costs of course they couldn't so I requested for them to find them and send me a detailed break down. Of course they have not done that either.

Wish they would just be honest and say we are charging more because we can and there is nothing you can do about it.

Because the rate of default is higher for BTL's than it is for residential mortgages as people are more attached to their home than an investment property. HTH

[mooshld]

Because the rate of default is higher for BTL's than it is for residential mortgages as people are more attached to their home than an investment property. HTH

It does I wish they had just said that.

[psychocandy]

Recently heard about Let to Buy mortgages. This is where you keep your existing mortgage and, rent it out, with your mortgage providers permission. Then you get this special Let to Buy mortgage to buy the new house to live in yourself.

Apparently, all the calculations are done on how much income you get from renting the original house out rather than income multiples etc. Not looked into it that much so no idea how competitive the rates are.

Mrs is keen on this idea at the moment. Trying to tell her its not that much of an investment etc with possible Capital Gains coming into it and that bunging a shedload into a pension may be better.

[lje]

Mrs is keen on this idea at the moment. Trying to tell her its not that much of an investment etc with possible Capital Gains coming into it and that bunging a shedload into a pension may be better.

Don't just assume the Capital Gains Tax will be bad - look into it. If you ever live in the house as your main home then capital gains is not due for the time that you lived there and, in addition, is not due on the last 3 years. So you can rent out your home for 3 years and then sell it with no capital gains issues. There are also lots of allowances you can put against it. It has been a few years since I looked into this so my information will be out of date - but I would do the calculations if I were you and trying to decide between different options.