[Closed] Any mortgage experts about? (BTL content)

You need to let your current lender know, they often just bump up interest rate by 1 or 2%, and say when you remortgage you need BTL.

You need to tell your insurer too.

You also need to fulfill all your other Landlord duties and legal contracts to the letter.

Speak to your mortgage company - when I let out my property they were happy to continue my existing mortgage deal unless I bought another house, at which point they wanted to switch me to a BTL mortgage. When my partner let her flat, the existing company moved her to a BTL deal with a 1% hike in the interest rate but no change in terms of exit fees / length of tie in etc.

I have to say, life is much better now we have sold those properties and don't have to deal with letting / tenants etc. They both only just covered their costs, and would certainly be considered loss making if our time was taken into account.

Have a look at the costs of setting up a tenancy too.
Gas safety cert
EICR
Smoke alarms
EPC
Endless paperwork (even worse in Scotland than England)
etc etc.
It might not be worth doing short term. Some people don't of course but as you asked about insurance, I guess you wouldn't consider that a risk worth taking.

Thanks all yes I want to do it well, I'll need to call my lender and look at other costs.

It's quite a high value/rent ratio so probably only worth doing if I want it back later in (£400K/£1,300).

Don't forget Tenancy deposit scheme as well....

And Landlord Registration.

And needing hardwired fire alarm.

Plus fire doors if building with flats in, plus outward opening fire doors.

And minimal habitation space standards such as length of kitchen worktop, needing clothes drying facilities (outdoors or tumbler dryer),  the move to minimal EPC standards soon.

I could go on.

Fwiw, your £400k/£1300 rent is less return overall than my £120k/£575, and I think it's not enough profit...

Yes, at that yield, I wouldn't consider it.

Buy to let can still be a good business, if you tick (most of) the boxes:

- yield
- availability of (suitable) tenants
- low maintenance costs particularly if a flat
- local
- manage it yourself
- willing to keep on top of legislation

... but by far the most important is yield.

If you rely on prices rising it becomes more of a (risky) investment than a business.

Thanks again. I will speak to my mortgage advisor who seems to know BTL well.

"And minimal habitation space standards..." - seems to apply to new builds only?

Good info @martin_t, I can tick most of your other boxes and the Edinburgh market is always strong I am told.

And needing hardwired fire alarm.

Not needed. You vcan get the long life interlinked by bluetooth ones now and they meet the legal standards. Still £1000 or so to fit out a large flat

Plus fire doors if building with flats in, plus outward opening fire doors.

only on Front door and then not checked either when I got my fires safety certs two years ago

Do NOT try to avoid landlord registration or deposit schemes tho

some of the requirements are local authority regs not national - never heard of the drying thing for example nad never seen a flat in Edinburgh with such

Correct TJ, many rules are local authority based and vary. We don't have the dryer thing either, 2 bed flats don't have to have fire doors, and smoke alarms only not hardwired fire alarm.

Thanks again folks.

@tjagain... someone said

Some people don’t of course but as you asked about insurance, I guess you wouldn’t consider that a risk worth taking.

...then I said...

Thanks all yes I want to do it well...

Then you said

Do NOT try to avoid landlord registration or deposit schemes tho

Really?

Have been an accidental landlord for the last five years, this has now ended.

I can't say I regret it drawing to a close - especially if it's a property you previously owned and lived in yourself.

Well I've decided to try it in the short term, don't think I can lose.

Cheers for the advice all