Richlist Posted October 7, 2014 Report Share Posted October 7, 2014 I learnt something new today that surprised me enormously. No doubt everyone else already knew this information but it was a real eye opener for me:- Take a look at the hot link below and in particular the age limit for BTL mortgages at the bottom of the page under the heading 'Availability'. It looks like my retirement may be a long way off now....... http://www.mansfieldbs.co.uk/mortgages_detail.aspx?id=200 Link to comment Share on other sites More sharing options...
Melboy Posted October 7, 2014 Report Share Posted October 7, 2014 I can't qualify............... Mind you looking at those T&C's you would need all of the 25 years to pay off the mortgage. Cash is King.... OK................ Link to comment Share on other sites More sharing options...
Mortitia Posted October 8, 2014 Report Share Posted October 8, 2014 Dead right Mel - just waiting to get our hands on pension cash. BTL - yeah about 18 months ago we looked at a BTL mortgage and were stunned to find that all major the lenders thought we were too old! It has been far easier to increase the mortgage on our own gaff which luckily has plenty of equity. Link to comment Share on other sites More sharing options...
Melboy Posted October 8, 2014 Report Share Posted October 8, 2014 I can remember way back in 1989 that I looked into a BTL mortgage for a property I wanted to buy and the terms and conditions were far worse than the example that RL has shown. The worse part as I recall, is that the mortgage company wanted to take a percentage of any price rise profit in that property value when it was eventually sold off.. I know I looked at other companies and none of them were that good with their percentages etc. so it was to be a couple of more years before I could buy a property outright. for cash. Link to comment Share on other sites More sharing options...
Richlist Posted October 8, 2014 Author Report Share Posted October 8, 2014 I have a 'few' BTL mortgages. I agree the interest rate is important but there are lots of other factors that go to make the product financially attractive, or not. * Some of us don't bother unduly about the lenders standard variable rates as we tend to re mortgage every 2/3 years where necessary, in order to take advantage of the low introduction rates. * Arrangement / application fees can make a big difference to overall costs and higher interest rates with low fees can work out cheaper than low interest rates with high fees. It just depends on how long you intend to keep the mortgage. * Some lenders offer free legals or valuations and some have less restrictions.....eg I see none in the Mansfield T&C's that disallow letting to benefits tenants... which might be of interest to some landlords. * Finally, using someone else's money to buy property by raising a mortgage is the route used by the majority of landlords. Choosing not to raise a mortgage but instead to delay a purchase by saving for a few years longer to pay cash has historically proven not to be a very good move. * The tax offset advantage of a BTL loan reduces the mortgage costs by 20% or 40% depending on ones circumstances. No mortgage = higher tax bills Link to comment Share on other sites More sharing options...
Mortitia Posted October 9, 2014 Report Share Posted October 9, 2014 I find the idea of taking out a BTL mortgage and letting to benefit tenants reckless. Did anyone see 'Pay or we take it way' on Channel 5 last night? One case showed the classic - woman with 2 kids on benefits. It was alleged by the council (BASILDON) she had a man co-habiting so benefits stopped and she stopped paying the rent. Landlord evicts and get a High Court warrant for speed. HC Bailiff turns up and woman saying council have told her to stay put with 2 kids till last minute - they end up re-homing her eventually. Imagine having that on a BTL if you don't have back up of other lets/income. Link to comment Share on other sites More sharing options...
Richlist Posted October 9, 2014 Author Report Share Posted October 9, 2014 I'm guessing here but.....I wouldn't be surprised if :- * 80%+ of all landlords who let to benefits tenants have a mortgage. * 95% of those don't even bother to check their mortgage T&C's. * 99.9% of those NEVER get found out that they are breaking their mortgage terms. * A very large proportion who let to benefits tenants have no problems whatsoever. Its easy to become convinced by a few disaster stories that its the norm where benefits tenants are concerned. Remember, generally, we only hear of the problems on forums and the media only report horror stories because it makes for good viewing figures. Yes, the risks with benefits tenants are higher but, I'd suggest its not quite as black as some would have us believe. Having said that, I wouldn't touch one with your bargepole......why ?......because I don't have to. Link to comment Share on other sites More sharing options...
Mortitia Posted October 10, 2014 Report Share Posted October 10, 2014 There are no national statistic to go by. I work for a big social landlord with around 800 letting units (not a council) and at any one time I know that just under 40% of tenants are in some sort of arrears. Out of these debtor tenants around 70% are on some sort of benefit payment. The worst offenders are the drug abusers but the LL gets paid hansomely by HM government for taking them on. Link to comment Share on other sites More sharing options...
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