Buy to Let - Midlands - UK - Clover Financial

Over the past few years, more and more people have taken to investing in buy to let property as a long term opportunity to make a profitable return, as well as a way of securing finance for their retirement plans. Buying a property to let can benefit the private landlord in two ways. Firstly, it can provide a stream of income. Secondly, many Buy to Let landlords purchase property because of the long-term potential accumulation of capital growth. This is why a buy to let mortgage is also known as an investment mortgage. The amount that the Landlord receives in rent may be over and above the mortgage payments and this will help to offset the cost of management and maintenance costs of the property.

Buy to Let should not be seen as an easy way of making money. It can be risky and more time consuming than other forms of investment, and there is no guarantee that house prices will continue to rise. That said, having an investment property or even a portfolio of investment properties to let to tenants could reap considerable rewards over time. And with the right mortgage in place and with the right advice this should be easier to achieve.

Getting the right mortgage for your investment properties is not always clear cut or easy. There are 3 main differences to buy to let mortgages. Firstly, the rental potential of the property can affect the mortgage as the decision to offer a mortgage is usually based on the rental income as well as your income and quite often your income is not ever considered. Secondly buy to let mortgages have slightly higher interest rates, as they are strictly speaking commercial mortgages. Lastly the deposit required is normally more than for a residential property typically being 20% – 25% of the property’s value.

You will have a choice of mortgage between capital and repayment and interest only and the first time investor will have to decide whether your primary objective is income or capital growth. Are you looking to make a profit month on month or are you looking to make a profit in increased equity from the investment property as it increases in value over time?

Our Advisors can help you choose the right mortgage whether you have just one investment property or if you have a portfolio of hundreds of properties. Each requires specialist advice to help you achieve the best return on your investments. Clover handles many large property portfolios and we can provide you with independent advice from a choice of whole of market mortgages available on a daily basis. Call us now to see how we can help.