When the housing market crashed a couple of years ago, it took with it another type of property development. Since the mid 1990s, there was a special type of mortgage that banks have been willing to make, known as “buy to let mortgages”. These loans are for properties the buyer intends to rent out and the repayments are calculated based the projected rental earnings for the property rather than the wages and earning of the buyer. These loans dried up completely for a while and nobody was able to acquire one. However, banks are once again starting to make some buy to let loans, and allowing property owners to also have a buy to let remortgage as well. When researching this topic I found geld lenen.
A buy to let remortgage can be used to refinance the original mortgage and take advantage of more favorable interest rates and payment terms or to finance another property purchase when the owner is seeking to grow his/her portfolio.
Finding a buy to let remortgage may not be as easy as it once was, but there are several lenders willing to extend the credit if the property owner has a good enough credit score. It’s easier to get a loan if the property is currently rented, and the owner is able to proove how much income it produces.
Buy to let remortgages can have repayment terms set up a couple ways – with the owner required to pay only interest due each month, or they can pay as a full repayment loan. Which terms work best for the owner varies from one property owner to another and one portfolio to another.
Typically, the main consideration that banks take into account when deciding on a buy to let remortgage is the likelihood that the property can generate income that is more than or equal to 125 percent of the interest due montly on the loan. If the answer is yes, the loan will likely be approved.
Using a buy to let remortgage to fund the purchase of another property can be a smart business decision. This way, the property that is already mortgaged remains the only one being risked in the event of problems repaying the loan. It is also easier to handle a single loan payment each month than to worry about separate payments for separate properties.
The main benefit of obtaining a buy to let remortgage or remortgage is that the income derived from the property usually is enough to cover most of the payments. Depending on what you do for income, other sources of income might not be high enough to even come close to loans on properties no matter what size they are.
Be prepared for the fact that finding a buy to let remortgage may end up taking some time and effort on your part as a property owner. It’s worth the effort, however, if one would like to refinance their current buy to let mortgage to benefit from term changes or to pay for a new purchase without putting the new property at risk. It might be more simple to obtain a buy to let remortgage for a purchase than to acquire the first mortgage on the new property as well.
