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FAQs

Frequently Asked Questions

We like to keep things simple, so here are all of the top questions that we get asked.

Have a quick read and if you still have questions, don’t worry we can help. Contact us on the form below and we will be in touch in a flash.

General FAQs

Want to know more about us? Here are some general FAQs but you can also find out more our company history, our team and the incredible charities that we are currently supporting.

How do the new PRA regulations affect me?
As well as the marginally increased stress tests introduced in January 2017 in Phase 1, which means that your rental income generally won't go as far as it did previously in generating the size of your buy to let mortgage. Lenders are also now required in Phase 2 to look more heavily at the performance of any existing portfolio of 4 or more investment properties. So as well as there being a rental stress test on an individual property being purchased or remortgaged, there are also certain performance markers that your current buy to let property in the background must meet. There have been many changes in the industry and a few more barriers to break through, but lenders are certainly still lending and we're able to help most sensible propositions. Mortgage Brokers have become polarised into those that haven't kept up with the changes, and therefore struggle to advise properly in the market, and those who have flourished under the changes and deal with larger portfolios and more complex scenarios in the limited company lending world. At The Buy to Let Broker, we're certainly in the latter category and well used to dealing with specialist lenders and complex scenarios every day.
Are you ‘whole of market’?
Yes indeed we are, but so are a lot of brokers. What sets a great broker apart, is knowing their way around all buy to let lenders products and criteria with total confidence, appreciating who will accept what, and who won’t – seeing potential problems before they occur. Therefore how we use the tools at our disposal is what makes the difference. We put in the hard work to find you the most competitive deal from the growing offering out there, and make sure we navigate the maze of criteria successfully for you. You can find more information on our approach on 'What's The Process' page. Knowing buy to let inside out means we find you the right deal – and saves us having to backtrack to other lenders.
Are you FCA regulated?
Yes. We are fully authorised and regulated by the Financial Conduct Authority via our approved network HomeLoan Partnership Limited under ref 506579. The Financial Conduct Authority does not regulate some forms of Buy to Lets. See our full compliance details at the bottom of the page.
What information do you need from me to get started?
Just the basics about your situation, income, preferences and property to be purchased. We need it so that we don't quote you mortgage deals you don't qualify for, there are lots of confusing criteria out there! It takes about 10-15 minutes to get started. Take the first step by giving us a call, or filling out the form below.
What's the best rate for me?
Sorry but that’s a toughy, a bit like calling an insurance company and asking for their best quote without telling them what car you drive, or how old you are! ...we can answer, but the figure is not necessarily relevant to you! The mortgage quote needs to fit many parameters. Also, the best rate isn't always the best deal, and we can usually find something more cost effective when we look at the set up fees and view the deal as a whole. In other words the cheapest rates usually have the most expensive fees, and often aren't worth paying. You can get a general idea on our Mortgage Rates page, but you'll need to give us a call, or email us to make sure you are eligible for it. We may also use our expertise to recommend any other mortgages suitable for your situation.
Who will deal with my case?
You will have one fully qualified and experienced Buy to Let specialist looking after you throughout the quote stage, application and beyond. We give you the continuity of one adviser – so you won’t have to go over old ground and things are never disjointed. The advisor is backed up by a mortgage administrator. We will always know where your case is up to at all times and we are available outside of office hours for you too. It takes about 10-15 minutes to get started. Take the first step by giving us a call, or filling out the form below.
How long does it take to get fully approved?
We can move very quickly for you, securing you a decision usually the same day, once you've agreed your quote. A mortgage offer tends to take between 1-3 weeks from application submission depending on the lender. If you feel the ‘need for speed’, we can avoid any slow coach lenders and recommend only those that can meet your deadline. Definitely needed where repossession purchases are concerned for example. We’ve never believed in the old saying "no news is good news", because in this business it isn’t - we push things through as quickly as possible for you, unless of course you wish us to slow things down for your own reasons!
Can I let my own home to buy another? (Let to Buy)
Potentially, yes, a common scenario being that the home won’t sell (at least for a price you would want) so there are options here, you could ask your existing lender for a consent to let, but it might not meet the lenders requirements or they may just refuse, and also may mean you don’t have a decent enough deposit for your next home. The solution might be to get a buy to let mortgage for your current place, raising a deposit for the new home...but it will all depend on the amount of equity you have and of course what your end goal is. There is plenty to consider and so you need the right advice.
What will you charge me?
Firstly, the charge is linked to loan amount, smaller loans attract a results based fee. Whereas with larger loans we can consider not charging a broker fee dependent upon the complexities of the case. Largely our fees are based on how complex the case is, and the expected level of work required to get you to completion. You will know our proposed fee from the get go. Our regular clients certainly think we are worth the money and keep coming back. You’ll see good value on your results based fee when using ourselves.
Why should I use you?
In brief, we are specialists in this area, so we know our stuff, you can pick our brains and get to know us, take some quotes at no cost and see the very best the market has to offer to you. We only quote deals which fit your circumstances, we are flexible and can tailor our service to you, and don't have annoying company policy and red tape to get in your way.... We are always available and our priority is getting you the best deals and completing your case with the minimum of hassle and fuss.....and keeping it straightforward for you the whole time! If you have any more questions to ask us and would prefer an emailed answer then please get in touch.

Buy To Let Mortgage FAQs

Here is everything you need to know about Buy to Let Mortgages and landlord legislation.

How many Buy To Lets can I have?
This varies from lender to lender, some lenders are concerned with how many mortgages you have for other buy to lets (background limits), others not so. It’s a case of us finding out what you currently have portfolio wise, and recommending a lender that is happy with that scenario, all lenders have black and white rules regards this. Also, in terms of how much any one lender will advance to you, again it varies, with some it depends on your credit score, others may only be happy with three in total. Put it this way we do have options to get around this issue, however, lenders are becoming increasingly sensitive to large portfolios and smaller personal incomes. So it may become problematic for those with ten+ properties across a spread of lenders.
What’s the maximum age I can be for a Buy to Let?
Well generally the mortgage can run up to age 75, but we do have mainstream lenders that will allow up to age 85 where needed, and some options with no maximum age provided the mortgage starts before your 70th birthday – although as you’d imagine that’s less common.
Is it difficult to get a Buy to Let mortgage in the current market?
Lenders are tightening their criteria, yes. Stress tests are tightening with changes in December 2015, and lenders are becoming more sensitive to overall mortgage debt in the background. Long gone are the days of a £25k salary enabling the ability to build a large portfolio regardless, but that's been the same for a long time. There are some obvious caveats to getting a landlord mortgage. You'll generally need a very good credit history, a decent deposit or equity of between 15-25%, most (but not all) lenders require a minimum income, say £20k to £25k but this can be joint in some cases. And your property must generally rent for a minimum of 125% of your monthly interest at a given rate, usually 5%-5.5%, although this can differ. As we've mentioned before, it is a case of marrying you up with the right lenders who can help given your circumstances. So you need a specialist who knows the right places to look, can find the best schemes, knows the lenders criteria back to front and has the dedication to push it through from start to finish. Now more than ever, you need to partner with a decent mortgage broker who is serious in this market.

Limited Company Mortgage FAQs

SPV Limited Company Mortgages (SPV) have become ever more popular following the Chancellor’s tax changes. Here’s our lowdown on the burning questions our clients have when looking to structure purchases this way.

Does my SPV company need a track record or trading history?
No, not at all. Technically the business could have been set up yesterday, so long as it's set up prior to any borrowing application, that's enough.
Is it tougher to get a company mortgage?
In short, no. It's no different to a personal buy to let mortgage in general underwriting terms. The strength of the application comes from the directors and majority shareholders themselves, rather than the Ltd company itself. Therefore trading accounts are not needed for new companies or SPVs. Almost all limited company mortgages require personal guarantee's, this enables the lender to ignore the company itself and focus their borrowing decision from a personal perspective.
What's an SPV?
An SPV is simply a type of company subsidiary that is well suited to holding property and is universally accepted by buy to let lenders in this market.
How should the company be set up for lending?
It's a very simple exercise, you just need to allocate a SIC code (Standard Industrial Classification) with Companies House, as you are required to do with any limited company upon set-up, the most commonly used are; 68209 – Other letting and operating of own or leased real estate 68320 – Management of real estate on a fee or contract basis Although there may be something that suits your business more specifically. You'll find a comprehensive list here - SIC Codes
Does limited company borrowing require a larger deposit?
No, limited company buy to let deals are available to a maximum of 85% loan to value. Although similarly to personal buy to let deals, there is more choice at 75% loan to value and below.
Is taking a Ltd company mortgage more expensive?
In general, mortgages are more expensive than personal equivalents. Currently there is much less choice on the Ltd company side. So you can expect to pay 1 - 1.5% more on the rate. Of course you have to also weigh up the possible tax advantages and look at the overall picture as it isn't as simple as just considering mortgage pricing. We are seeing new lenders enter the market and we have also seen the gap closed in terms of rate differential, so deals are already getting cheaper. Watch this space for the bigger players to enter the arena - how long that will take or whether they are certain to move over, time will tell.
Can a trading business be used to buy residential investment property with a mortgage?
Yes, but you are limiting your options by doing so. The market for limited company buy to let is small compared to personal offerings and you'd be further limiting your options by going down the trading business mortgage route. You'll be offered more choice by using the aforementioned SPV, and chatting to your accountant about tax-efficient ways to move the deposit and ring-fence your property away from your day to day business.
How do lenders expect deposits to be structured?
Many lenders are accepting of your creation of a directors loan. So if you invest your own personal cash into the company, you can draw that capital from the company at a time when it can afford to pay you back, tax free, since it was paid in by yourself in the first instance. Other ways to move cash to the newly created company include a transfer from your trading business. Again, talk to your accountant about the best way to make this happen, and we can ensure that the lender is accepting of the intended route.
Can I transfer personally owned properties to a limited company?
Yes, however it would need to be done with care and careful consideration. Despite the fact you may own 100% of the new business, your company would be an entirely different entity to yourself, so the word 'transfer' isn't accurate. Your company would be undertaking a new purchase, and therefore this could trigger capital gains tax or CGT personally, and of course since it is a new acquisition, stamp duty would need to be paid by the purchasing business. So although it's a consideration, often it's an expensive move and other options take precedence.

HMO FAQs

Financing a HMO property is more involved than purchasing a terraced house for example. Here we’ll run through some questions and answers to the most common questions we get asked for those looking to finance a house of multiple occupation (HMO).

What’s an HMO?
It stands for 'House of Multiple Occupation (HMO)', basically a property let to multiple tenants. They could be students or professionals.
Are multi let and HMO mortgages more expensive than standard buy to lets?
Well possibly not, lets give you some insight here - if we're talking about properties let to say 4 or less students or professionals, then often the property won't require a HMO licence, so assuming the tenants are on one tenancy agreement then many buy to let lenders can lend on their standard products. This means you'll get exactly the same deal as a landlord letting to one household. Increased yield with no increase in mortgage cost! It's worth noting that lenders will base their maximum loan on a one household rent despite the fact you could be receiving considerably more from multiple tenants. With regard to licenced properties, some lenders allowing smaller HMO's only, say 4-5 bedrooms can often allow lending on their standard Buy to Let ranges also, so pricing isn't always impacted. It is true to say that you do need an expert here, a broker who understands what is allowed and what isn't. Otherwise, you could be declined upon survey having wasted a few hundred pounds. So far, we've discussed a lot of options that are available for multi-let and smaller HMO properties where pricing isn't always affected. Once we hit 6 bedrooms plus whether licenced or the property doesn't need a licence, then yes, mortgage rates and fees tend to increase. This is mainly due to the perceived risk, and also that there is less competition in these markets and therefore less choice. Most buy to let lenders don't operate in the arena, and so the help of a specialist is often the best way to find what you want.
What’s the maximum number of bedrooms I can have in a HMO?
Technically we have lenders who have no upper limit to numbers of bedrooms, but lenders will always be risk-averse to some degree and so if they feel at risk should the property be repossessed then they can walk away. Any properties with bedrooms numbering 10 and above we will generally.
How competitive are HMO rates at the moment?
Extremely, the lowest rate we have currently available for licenced HMOs is 2.00%! Rates are changing all of the time, so please visit our HMO page for a general idea of what's available. For a more accurate quote for your circumstances, please give us a call or get a quote here.
Is it more difficult to obtain an HMO mortgage?
No, not really, other than the fact some lenders for larger HMO properties (6 bedrooms plus) will wish you to evidence landlord experience, in other words show that you have rented property for a certain period, anything from 6 months to 3 years. For smaller HMO's and multi lets, if we're using a standard lender on standard rates, then there is no difference at all assuming the valuation fits within a lender's criteria.

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