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.