Compare the Best Fixed Buy to Let Mortgage Deals in the UK
A fixed buy to let mortgage is a mortgage specifically for a landlord to buy a property and rent it out to the public but the interest rate they pay for their mortgage is fixed. A fixed interest rate means that your monthly payment will not change during your mortgage term of 3,5, 25 or 40 years.
The main advantage of agreeing to this fixed rate is that you could potentially save money if the Bank of England Base Rate decides to increase, meaning that other types of repayment options such as a tracker mortgage or interest only mortgage could be more expensive. Above all, having a fixed rate every year allows landlords to budget and plan their finances effectively.
Fixed Buy to Let Mortgages – what interest rate will I pay?
The interest rate that the landlord is charged for their mortgage will largely depend on their credit score and employment status. Those applicants with a good credit score and a good flow of income will usually be able to obtain the best rates of interest. By comparison, if you have a bad credit score and your income is not steady, you will may not be able to access to the lowest interest rates because you are a greater risk of default.
How much can I borrow from a Fixed Buy to Let Mortgage?
How much you can borrow from a mortgage provider will depend on how much you can deposit. The more you deposit on the property, the less you need to borrow in the form of a mortgage. The loan-to-value (LTV) refers to how much you need to borrow as a value of the mortgage. So if you put down a deposit of 25% of the property’s value, you will need a loan-to-value of 75%. Typically, the highest loan-to-value percentages are usually available to those with the best credit.
Am I eligible for a Fixed Buy to Let Mortgage?
To be eligible for a fixed buy to let mortgage, you must follow the criteria below:
be over 21 years of age but younger than 80
have a minimum annual income of £25,000
no more than 3 buy to let mortgages per person
cannot borrow more than £2 million
The advantages of a Fixed Buy to Let Mortgage
There are numerous benefits to taking out a fixed buy to let mortgage package:
Payments are Predetermined
Rather than having to constantly check current interest rates, a fixed buy to let mortgage gives you the safely of ensuring that what you pay never changes over the agreed period. Therefore, no matter how much interest rates may increase by or fluctuate, you are always protected.
Easier to Plan Ahead
With a fixed rate buy to let mortgage, you are afforded the luxury of being able to plan ahead. You can work out how much you will have to pay over the agreed period and set aside a lump sum of money to help you cover those costs. This would not be possible if your payments were subject to interest rates and fluctuations. This is particularly helpful for landlords who have to factor in the cost of replacing household items or a loss of rent.
Having to keep the property occupied is difficult enough without having to worry about how much you will need to pay should it become vacant. With a fixed buy to let mortgage, you will be able to look ahead and evaluate just how much money will be needed each month in case the tenants leave the property and leave you short of the income generated.
Find the Best Fixed Buy to Let Mortgage Rates
With so many different rates and providers out there, Quiddi Compare helps you to find the best rates available for fixed buy to let mortgages. We work with some of the leading mortgage providers in the UK and we are constantly looking out for the best deals and discounts available. Simply fill in some basic details so that we can find a quote for you today. Our service is 100% free for mortgage buyers and we take a small commission from the mortgage providers and ensure our service is always free.
Before applying, please take note of the arrangement fees charged by mortgage lenders which may range from £1,000 to £3,000. This includes arrangement fees, valuation fees and solicitor fees.
When purchasing your property, consider how much it may cost to fix up the place such as new walls, floors, paintwork and white goods. You do not want to be in a position where you overspend because failing to keep up with mortgage repayments may cause a negative impact to your credit score and repossession of the estate.
Finally, consider the area where you are buying the property and whether it will sustain its value. A buy to let mortgage is a long term investment and you want to ensure that you will be able to continue to charge rent at a profitable rate and potentially resell the property for more than you bought it.