Let to buy mortgage

How does a let to buy mortgage work?

Let to buy mortgage
Let to buy explained

Want to rent out your current home and buy a new property to live in at the same time? Watch our video to find out how a let to buy mortgage can help you do just that!

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Let to buy mortgages

A let to buy mortgage enables you to rent out your current home and buy a new one to live in. To do so, you need to change your current mortgage to a buy to let mortgage and take out another mortgage for your new home.

As you will need to arrange two new mortgages and ensure they both complete at the same time, seeking help from a whole of market mortgage broker is advisable. A let to buy mortgage broker like Fosters Financial, will be able to explore all the options available and tell you whether it is the best option for you. Many let to buy mortgages are also only available via a mortgage broker. So, they will not only be able to find the best let to buy mortgage rates available to you. But also manage the entire application process for you.

Mortgage moving house
  • Is let to buy a good idea?

    Let to buy can be a great option. It is mostly used by homeowners to move house, whilst they let or wait to sell their existing property. But it is also popular with those looking to move away temporarily and retain their homes.

    As everyone’s needs are different, it is important to check whether a let to buy mortgage is right for you. If you are interested in discovering your options, then speak to one of the brokers at Fosters Financial today.

  • Mortgage criteria

    If you need to switch your current deal to a buy to let mortgage, the rental income from letting your existing property will need to sufficiently cover your mortgage repayments. The amount will generally need to be around 145% and you will also need a minimum deposit of 20%. But if you want to access the best let to buy mortgage rates, then 25% or more is recommended.

  • Let to buy stamp duty

    As you are buying a second property, you will need to pay an additional 3% on top of the standard residential Stamp Duty Land Tax (SDLT) rates. But if you sell your existing home within three years, you can apply for a refund.

    Use our handy stamp duty calculator to see how much let to buy stamp duty you will need to pay.

  • Consent to let

    If you only want to let your current home for a short amount of time, your mortgage lender may give you ‘consent to let’. This would effectively enable you to let out your home, without having to change your mortgage. Every lender is different, so it is important to check what their policy is, which we can help you with.

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The Financial Conduct Authority does not regulate most buy to let mortgages.

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