If you’re a homeowner in the UK, you may be wondering if you can change your mortgage to a buy-to-let mortgage. The answer is yes, but there are a few things you need to know before you do.
What is a buy-to-let mortgage?
A buy-to-let mortgage is a loan that is specifically designed for landlords. These mortgages have different features than residential mortgages, such as higher interest rates and stricter lending criteria.
Why would I want to change my mortgage to a buy-to-let mortgage?
There are a few reasons why you might want to change your mortgage to a buy-to-let mortgage. For example, you might be moving out of your current home and want to rent it out. Or, you might be buying a new property to rent out.
How do I change my mortgage to a buy-to-let mortgage?
There are two main ways to change your mortgage to a buy-to-let mortgage. You can either:
- Ask your current lender for consent to let. This means that you will be allowed to rent out your property, but your mortgage will still be classified as a residential mortgage.
- Remortgage to a buy-to-let mortgage. This means that you will take out a new mortgage that is specifically designed for landlords.
Which option is right for me?
The best option for you will depend on your individual circumstances. If you are happy with your current lender and you think they will give you consent to let, then this may be the best option for you. However, if you want to get a better interest rate or you want to switch to a different lender, then remortgaging to a buy-to-let mortgage may be a better option.
What are the costs involved in changing my mortgage to a buy-to-let mortgage?
There are a few costs involved in changing your mortgage to a buy-to-let mortgage. These costs may include:
- Early repayment charges. If you have an early repayment charge on your current mortgage, you may have to pay this if you remortgage.
- Mortgage valuation fee. Your new lender will need to value your property before they can offer you a mortgage.
- Legal fees. You will need to pay legal fees to arrange the change of mortgage.
How do I find out if I can change my mortgage to a buy-to-let mortgage?
The best way to find out if you can change your mortgage to a buy-to-let mortgage is to speak to your current lender. They will be able to tell you if they offer consent to let and what the terms and conditions are.
You can also speak to a mortgage broker. They will be able to compare different lenders and find the best option for you.
Conclusion
Changing your mortgage to a buy-to-let mortgage can be a good way to generate income from your property. However, there are a few things you need to consider before you do. Make sure you understand the costs involved and that you meet the lending criteria.
If you’re thinking about changing your mortgage to a buy-to-let mortgage, speak to your current lender or a mortgage broker to find out more.
Here are some additional tips for changing your mortgage to a buy-to-let mortgage:
- Get your finances in order. Before you apply for a buy-to-let mortgage, make sure you have a good understanding of your finances. This includes your income, outgoings, and debts.
- Get a good valuation. The value of your property will affect the amount of money you can borrow. Make sure you get a good valuation from a qualified surveyor.
- Compare different lenders. There are many different lenders offering buy-to-let mortgages. Compare different lenders to find the best deal for you.
- Get professional advice. If you’re not sure about anything, get professional advice from a mortgage broker or a financial advisor.
I hope this blog post has been helpful. If you have any questions, please leave a comment below.