Can I start by getting on the property ladder in the North?

by Readers Question

3 years ago

Can I start by getting on the property ladder in the North?

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Can I start by getting on the property ladder in the North?

I’m currently renting in an expensive area down South where I will never be able to afford to buy a place for myself.

Obviously I am not hugely enjoying spending so much on rent when there is the potential to buy property instead. I was thinking of buying somewhere near my hometown in the North where it is much more affordable, and letting that property.

Even if letting the property did not quite cover the mortgage repayments I could still afford to contribute extra from my salary, and continue to rent down here.

Having done some Googling (with very limited results) it appears that lenders do not look too kindly upon people in this situation who look to buy their first property without the intention of living in it.

Could anyone recommend where to start, and indeed if I really have any chance of this happening or just need to give up?

Simonladder



Comments

Neil Patterson

3 years ago

Hi Simon,

First of all this would have to be a Buy to Let mortgage as you must not mislead the lender as to the intended use.

As I think you have found BTL lenders are not keen on lending to borrowers who have not owned a property before as they believe it to be higher risk (lack of experience and proven ability to keep up mortgage payments) Therefore a company did consider lending on an investment basis it will be at a much lower Loan to Value than a residential mortgage. You would probably need a 30% cash deposit. However, one of our full time brokers would need to confirm this for me.

Nearly all BTL lenders require that the rental income is at least 125% of the interest only mortgage payments and do not take into account your income which could be used else where at a later date. I have seen Barclays are making an exception on this though.

Would you be able to purchase the property jointly with a member of family or close friend that has owned property in the past as this would greatly assist your search?

Lyndon B

3 years ago

Hi Simon,
Great forum to ask, I've found this resource a superb source of info for 'newbies' such as us.
I was in a similar position to you, and thankfully now own 2 BTL's at 26, hoping to purchase more when funds allow.
It's little known that Natwest are one of the only 'first time landlord' lenders that don't always require you to be a homeowner first.
There possibly are other lenders but I found Natwest to be helpful in my rare situation and it was convenient for me without any additional fees at the time
Good luck!

3 years ago

Go for it Simon, you'd be mad not to. lots of people on this forum would lend you a hand and point you in the right direction, myself included ( free, of course )
chrispdaniel@virginmedia.com


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