Building a Buy to Let Portfolio:

Buy to let mortgages differ fundamentally from standard residential mortgages in that they are normally based upon the rent that the buy to let property will achieve as opposed to a homeowner’s personal income. It is the fact that rental income rather than personal income is used that means that the limiting factor in determining just how many buy to let properties you could own is effectively the deposits that you will need to put down. At Fee-Saver Mortgages a great deal of our business is geared around helping existing landlords to release equity from their current portfolio and to put funding lines in place to make available the deposits required to buy more property.

Many landlords fall into property investment. This could be because they are moving to a new area or to with a new partner but want to let out their current property so that they have a base there should they wish to return. For those that want to make a concerted effort to invest in property we have outlined below a way that this could typically be accomplished:

1. You will need a deposit to buy your first buy to let property. This could be from savings, but often comes from equity in a residential home (the recent surge in house prices has left many people equity rich but cash poor)- talk to one of our advisers to see if this may be possible for you.
2. You could potentially take a 90% buy to let mortgage- so to give an example you could buy a property to let for L150,000 and take a L135,000 mortgage.
3. Assuming that property prices rise at 6% per year*, after two years your property will be worth L168,540.
4. By releasing the L18,540 equity that has been built up you now have a deposit for your next buy to let property. ..and you are well on the way to building a portfolio by repeating this process. We have known teachers with multi million pound portfolios that would be completely out of their reach were it not for the availability of buy to let mortgages and the benefits of gearing.

At Fee-Saver Mortgages we have access to buy to let deals that will allow increased borrowing in line with rises in market value and semi exclusive mortgage products that are not widely available. If you are keen to build a property portfolio talk to one of our advisers today to make sure that you too can benefit from accessing the right funding to meet your strategic investment aims.

* This is an assumption for illustrative purposes only and no guarantee of the way that the housing market will behave.