YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
Abacus Financial Ltd is authorised and regulated by the Financial Services Authority and is entered on the FSA register under reference 461796. We charge a fee for mortgage advice and this is £99. Loans are subject to status, value and type of property. Think carefully before securing other debts against your home. The guidance and/or advice contained within this website is subject to the UK regulatory regime and is therefore targeted at consumers based in the UK. The FSA does not regulate all forms of the products or services we provide. Sometimes we may pass your enquiry to our trading style of Abacus Associates. These pages provide generic information about various aspects of financial services advice that we provide either directly or as a referral service through carefully selected partners, as well as possible areas of clients’ financial planning needs. We hope they are helpful to you but they do not, on their own, add up to proper advice and we cannot take responsibility for anything you do in reliance on them without further discussion with us. Please do not make a decision based upon the information contained within these pages alone. They are not detailed or comprehensive enough to enable you to make an informed decision which is tailored to your circumstances and needs. Abacus Financial Ltd is registered in England, Registered number 5301473, Registered Address: 4 Thomas More Square, London E1W 1YW. VAT Registration Number 977 2291 81
Buy-To-Let
Property can be an excellent long-term investment, with the potential to offer good income and good growth. Many people invest in a buy to let property as a sort of pension - the rent each month can be used to supplement your retirement income, or the property can be sold and the proceeds used as a nest egg. It is important when searching for a property that you look at its 'rentability' as this is fundamental when you come to place it on the lettings market. Take care not to look at the property as your own home - remember that buying a buy-to-let property is a form of running your own business.
Mortgage rates are not the same as in the residential market - lenders generally consider buy to let a greater risk, so their interest rates or arrangement fees are normally higher than their residential rates. The deposit required for buy to let mortgages is also higher. Nowadays, most lenders ask for at least 25% of the value of the property although there are some deals currently available with only 20% deposit.
The way that buy-to-let mortgages are assessed is also different to standard residential mortgages. Most lenders will look at the property you are purchasing as a 'stand alone' proposition, where the rental value of the property must sufficiently cover the expected mortgage payments. This can differ from lender to lender, of course, and your Abacus adviser can assist you with finding the most appropriate lender. Indeed, buy-to-let mortgages are generally seen as a specialist area of finance so please do contact us to discuss your requirements.
Finally, you are probably aware that tax is a complicated subject and we thoroughly recommend that you seek professional advice from an accountant. With regards to buy-to-let properties, you should bear in mind that you are liable to pay income tax on the rental income you receive and when you come to sell the property you may be liable to pay Capital Gains Tax.