BTL MORTGAGE VS. RESIDENTIAL

[pugsy]

Hi everyone.

Does anyone know if it negatively affects your credit status if you have ALL BTL mortgages and not a residential mortgage?

[Matthew]

Hi mate,

I think it depends what your after. Detailed searches on your file done when you get a mortgage, it shouldn't affect. They will probably ask why you are buying a property to rent when you don't own your own property, as I was asked this once, but not a problem as I explained why.

If you are applying for a credit card/mobile phone whereby a computer generated result is used then it will probably adversely affect your score. They prefer home owners to renters. If you move around alot, this will cause problems also.

However, I am told by Rodent that by contacting the Credit Card companies and actually speaking to someone, they may change their stance.

The problem is all companies use sifferent methods to evaluate your credit worthiness, so it is impossible to know the exact affects of things like this.

[GPEL]

As Matthew indicated, it's a $64 million dollar question as no set criteria. However, if you don't borrow you don't get a credit assessment and companies like to see a good lending v payment record as evidence of financial worthiness. Armed Forces often have problems getting credit after returning from long stints overseas if they have no UK credit history but then the Armed Forces are stuffed in many ways when returning home.

[pugsy]

Yes, I see what you are both saying. Thanks for the quick responses; it's only because my home is due a remortgage while we're away for a while... and my btl broker has some fab. deals. I wondered if it was wise to take advantage of these btl rates which, sadly, are beating my residential remortgage quotes hands down... but it seems that it may not be worth the complications. Cheers.

[Simon Dewsberry]

hi Pugsy

I dont see that this could have a Negative effect in any way personally !

I regularly talk to risk underwriters as all of my financial dealings are under "sole proprietor" status ...my credit report is now 29 pages long (all my personal, business and prop; acc's, loans, morts, and supplier credit accs are all in my name ......being a professional cc tart adds quite a few pages!!)

I find most times nowadays that my "profile" is not the "norm" and often get phone calls asking why my name is associated with so many different addresses ! but a short conversation always clears it up ..

I would go whichever option is financially most benificial to you ...as long as you are servicing accs properly you have nothing to worry about !

Simon

[pugsy]

Good point Rodent, like you say, being a landlord does complicate your profile a bit but as long as you service accs properly, what's the problem? I'm tempted to save a few hundred a month and go btl. I just asked my broker his opinion... so we'll see.. thanks again.

[pugsy]

Just in case anyone is interested; my broker says that this in itself is not a problem as long as you keep one UK property as your 'bank' address - ie one address a lender will still be able to identify you at. As opposed to keeping your residential mortgage as long as you have an address with a bank statement etc you should be fine. Plus keep on the electoral roll at this address. So, there you go...