Buy-to-Let Mortgages

Know what your financial intentions are from the offset. Will the money be used as your regular income or will it be set aside as capital growth? You’ll also need to have a clear budget in mind, accounting for your monthly mortgage payments, income tax, utilities and any unforeseen costs.

With more than 160 laws for landlords to comply with, there’s lots to think about. To help navigate the complexities, it may be worth appointing a Letting Agent who will be clued up on all the rules and regulations associated with being a landlord. However, we still recommend you take the time to learn the main areas of legislation to ensure the safety of your tenants.

This is probably the last thing you’re thinking about right now, but it’s important to consider your exit from the Buy-to-Let market just as much as your entrance to it. For instance, will you sell your property after a certain number of years, or perhaps when it’s reached a specific value? Having a clear exit plan will also help you to settle your finances in the most tax-efficient way possible.

While there are plenty of things to think about as part of the Buy-to-Let process, there are certain practices you’ll want to avoid altogether:

• Not understanding exactly what being a landlord entails, including keeping the property in good condition, looking after your tenants’ needs and dealing with relevant paperwork

• Diving straight into buying a property with no wider consideration of the Buy-to-Let market. This includes not seeking the right mortgage advice, and as a result, not understanding the implications of tax, associated costs and responsibilities involved with renting out a property

• Not protecting your property or your finances against the worst-case scenario.

• Not keeping up with the Buy-to-Let laws and regulations, and therefore not protecting the health and safety of your tenants

The property investment market can fluctuate depending on the economic state at any given time, so it’s important to speak with a mortgage adviser to protect your finances and insure your property.

You should also consider speaking with an accountant regarding your Buy-to-Let investment so that you have a clear understanding of your financial situation.