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Our property investment expert is Jeni Browne, Sales Director at
Mortgages for Business
www.mortgagesforbusiness.co.uk
Tel: 0345 345 6788
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Question
Buy- to-let business: Can I form a partnership?
I have two buy-to-let properties which I have successfully been letting out for nearly a decade. My friend has said she was keen to get into the buy-to-let game and asked if I would be willing – as it’s her first foray – to join forces on a property and become ‘joint landlords’.
Is there anything preventing us from doing this? My friend owns her own property and seems pretty sound financially. I am confident she will be a good ‘partner’ but I wondered what the legal implications might be and whether there would be any problems taking out a joint mortgage.
Answer
I can’t advise on the legal implications of this venture (I would strongly suggest you speak to a solicitor to check before you move forward), but what I can do is talk to you about taking a joint mortgage.
Based on the information you have provided, there is no reason why you would not be able to get a mortgage together, be this in personal names or through a Limited Company. We regularly see friends decide to joint venture on buy-to-let, and the mortgage availability is never an issue.
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Question
Tips for getting accepted for a buy-to-let mortgage
Is there anything I can do to make myself a better prospect for a lender? I tried getting a buy-to-let mortgage a few years ago but was turned down by lenders because I didn’t have a big enough deposit. I have now got some savings to put into a project and would love to know anything I can do to springboard myself into the market.
I have £40,000 to put down on a property now. I also own my own house, although it is mortgaged.
Answer
To help steer you in terms of what type of property value to look at, you will need to put down a minimum of 20% to 25% deposit and don’t forget to account for your stamp duty costs and other costs associated with buying a property such as legal fees.
In terms of access to a mortgage, as long as you have an income and a clean credit file, there should be no reason why you are not able to apply successfully.
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Question
Getting a buy-to-let mortgage post-furlough
I am hoping for some advice as I have just returned to work having been on furlough. I am also in the process of purchasing a buy-to-let. I was about to proceed before Covid but it all fell through what with the lockdown and my job situation.
I am back at work and hoping to pursue my project but just wanted to check how the furloughed period (I was on 80% pay) might appear to a lender. Most of the calculations, I believe, will be based on yield and my deposit but I would still like some reassurance before I go ahead. Thanks.
Answer
Lenders are really pragmatic about applicants who have been on furlough. As long as you can show that you are now back at work and you present the lender with one payslip which will show your post furlough income, then you really will not have any issues. I hope this helps and good luck.
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