In this section you'll find answers to some of the questions that our customers typically ask and some terminology explained.
Do you provide advice on Buy to let mortgages?
At Blackstone, we provide an advice and recommendation service for buy to let mortgages and will search the market to find the best mortgage for you based on your property and individual circumstances.
What documents and information will I need for my mortgage appointment?
Please see our Pre-appointment checklist which has a full list of the documents and information you will need to provide to your mortgage adviser to get accurate advice.
How do I access the best tiers of interest rates?
Higher deposits, which are often 30% to 40% of the property value, will provide access to the best rates available on the market.
Are first-time landlords able to access buy to let mortgages?
Yes, we have a choice of products available to first-time landlords.
Can I get a buy to let mortgage if I’m self-employed?
Yes. All applications are subject to underwriting, lender criteria, property and rental assessment as well as other checks. Some lenders also require a minimum personal income; for self-employed applicants, these lenders will usually want to see evidence of your taxable net profits for your business.
Can I get a buy to let mortgage if I don’t own a house?
Buy to let mortgages are arranged against the property you wish to let out and our extensive network gives us access to a wide range of lenders who will consider a buy to let mortgage from many different types of applicant including non home owners.
Do I need landlord specific property insurance for a buy to let mortgage?
Yes, you will need landlord’s building/property insurance to protect the structure of your investment property from events such as fire, vandalism, storm or flood. It’s an essential part of your mortgage agreement to ensure that you have a minimum level of buildings insurance at exchange of contracts. Please take a look at our landlord’s insurance page, or talk to us for further information.
When can I use my portfolio of properties to invest in further properties?
If you have multiple properties coming to the end of their tie-in or early repayment charge period and ample equity, it’s usually a good time to ask for a portfolio review to maximise your investment returns. Many of our landlords expand their portfolio by re-mortgaging to raise funds to invest in further property. Your adviser will make personal recommendations tailored to you and your business aims.
Will I need a local council landlord’s licence to take out a buy to let mortgage?
In general, when letting your property to a family, landlords in England and Wales do not need a rental licence to get a buy to let mortgage, although more local authorities are introducing this requirement - we would recommend you check this when deciding which area you plan to buy in. However, if the property is classed as a licensable House of Multiple Occupancy (HMO), the lender will need sight of the HMO licence issued by the local authority. Licensing is mandatory for all HMOs which have three or more storeys and are occupied by five or more people. Please see HMO in the terminology section below and also our HMO page.
What are the main property running costs that I need to consider?
These include: property maintenance - such as repairs and maintaining the safety of gas and electrical appliances, landlord's building and contents insurance, service charges and ground rents (for leasehold properties) and letting agent charges - if applicable.
Usually the tenant is responsible for other property related costs such as council tax, utilities and the TV licence fee. The tenancy agreement should set out who is responsible for each of these payments.
Must I complete a tax return?
As a landlord, you’ll have to submit your rental income on your tax return and will need to take advice on the tax implications from an accountant or tax adviser. So it’s vital you keep detailed records of the rental payments you receive and all the expenses you incur. Your accountant will advise of any allowances that you may be eligible to use to potentially reduce your tax bill.
For further information visit www.gov.uk/renting-out-a-property
Do I receive FCA or FOS protection when taking out a buy to let mortgage?
No. Buy to let mortgages are not usually regulated by the Financial Conduct Authority.
Remember your Blackstone adviser is on hand to answer any questions or concerns you may have and provide advice based on your individual circumstances. Please contact us now for a free, no-obligation consultation.
BUY TO LET MORTGAGE
A buy to let mortgage is a loan you can take out to buy a property that you intend to rent out to tenants. You use rental income to cover your mortgage payments.
Typically you will need to fund at least 25% of the property value, however, some lenders may offer mortgages with only a 15% deposit.
A House of Multiple Occupancy (HMO) is defined as being a let property where three or more unrelated tenants share. We can help you find an HMO mortgage best suited to your financial requirements and future plans.
Buy to let mortgages are usually given on the basis of the likely rental income of a property. This is typically at 125-160% of the monthly mortgage repayments. Lenders want to satisfy themselves that the rental income will more than cover the monthly mortgage payments and will often stress test the mortgage at a notional interest rate higher than your actual mortgage interest rate. This provides a safeguard against periods when the property is not let and helps landlords cover the property running costs and potential repairs.
VALUATION AND RENTAL ASSESSMENT
For buy to let mortgages the lender’s valuer will be asked to provide an expected market value for both the property value and the realistic monthly rental figure achievable.
Please also see our Mortgage FAQ section for further terminology.
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