You’ll have to get permission from your lender to do this. If you don’t change your mortgage, you risk invalidating your mortgage contract and being asked to repay your whole loan at once.
Then when you start considering things like fixed rates and fees, it can get complicated, so check with your broker on the best thing to do first.
(Don’t forget to upgrade your buildings insurance to landlord’s insurance. And make sure you understand all your responsibilities as a landlord.)
If you have a residential mortgage already, and you want to let out your home for a specified period of time – a year, say – you can ask your current lender for a “consent to let” mortgage. This is different from a buy-to-let mortgage, where you make your intentions to let clear from the beginning.
That’s because consent to let is seen as a temporary thing – you won’t be able to keep asking for several in a row.
During the consent to let period, lenders will usually raise the interest rate (because you renting out your home means more risk for them). Then when the period comes to an end, if you want to continue renting out your home, you can remortgage onto a buy-to-let mortgage.
If you want to rent out a home you already own, and at the same time buy another home to live in yourself, then let-to-buy is for you.
Let-to-buy is a way to apply for two types of mortgages at the same time:
Finding two good deals at the same time that are each right for you and work together might be a challenge if you go it alone. Speak to a mortgage broker to help you make sense of let-to-buy.
Thinking of buying your first home but not sure where to start? Here’s a simple, step-by-step guide to the process – from sorting your finances, to viewing properties, to getting the keys to your new home.
Buying to let can cost way more than you expect. Get clued up on landlord costs: from letting agent fees, to property maintenance, to tax.
Habito specialises in helping you get the best mortgage or remortgage, all online, for free
