I am currently going through the courts to get my tenants evicted for non-payment of rent. They owe six months’ rent and now I have gone into arrears with my lender as I can’t afford to cover it. When they have gone I intend to sell the house as it is in a good area and house prices have gone up so I will make a profit. I want to buy a house in a less affluent but up-and-coming area in the hope that house prices will go up there eventually. I am concerned that because I have been in arrears I might not be able to get another mortgage.
Have you got a clean credit profile? If you are unable to pay the mortgage during non-tenanted periods (or when a tenant fails to pay the rent), are you really in a suitable position to take on the responsibility of being a landlord with a mortgage?
Going forwards, these are the types of question that lenders will be reviewing even more vigorously than before. Consequently, you may well find it very difficult to get another buy to let mortgage straightaway. If you are able to make good on the outstanding debt, some lenders may reconsider you after a certain amount of time has passed (often 1-2 years) but this cannot be guaranteed.
Your best bet would be to use an experienced buy to let broker who can negotiate with lenders on your behalf. In the meantime, I suggest you maintain a close dialogue with your existing lender to help you through your current difficulty.