The client is a part-time landlord who owns three buy to let properties and was looking to buy his first home - a 3-bed detached house in the Midlands. He is also employed working fulltime as a land manager.
The challenge for us was to find a lender that would not include the client’s three buy to let properties in the affordability calculation.
Some lenders take into account all mortgage borrowing and if the total indebtedness is more than eight times the applicant’s income, they won’t lend.
Other lenders won’t lend if more than 30% of the applicant’s income is from rent.
Fortunately, we have access to a lender that ensures that each buy to let mortgage is sufficiently covered by the respected rent, then excludes it from the affordability calculation, relying only on the applicant’s other income – in this case from the client’s salary.
Here are the details of the rate were able to secure for the client:
Property value: £150,000
Loan amount: £112,500
Rate: 1.79% 2 year fixed home-buyer mortgage
Term: 25 years repayment (capital & interest)
Lender arrangement fee: £999 added to loan
Mortgage repayment: £465 pcm
Consultant: Andy McOwat
Consultant tel: 01625 416396
20th August 2015