Landlord Mortgage Expansion Advice required

by Readers Question

9:46 AM, 22nd March 2015
About 4 years ago

Landlord Mortgage Expansion Advice required

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Landlord Mortgage Expansion Advice required

Hi all,

First of all, I like this site, the wealth of available information is immense, however, I am green and therefore require some advice, here go’s … Landlord Mortgage Expansion Advice required

In 2011 I went through a divorce and with the financial help of my parents paid off my ex for 50 percent of the property equity. She has no financial hold on this property whatsoever. I have met a new partner and we now lived together since Deptember 2013, and all appears to be going well. My “old” house has been rented out from that date onwards. I am now interested in possibly buying another place to rent out, is this (a) possible? and (b) in my best interests for the future? I currently pay £200 pm for a stocks and shares ISA. Here are my statistics on which to base your answers:

  • Age 45
  • Mortgage to pay back £78,000, Northern Rock variable rate remaining term 25 years in my name only
  • Rent £900 pcm for 3 bed semi in Dartford of which £45 to letting agent for rent collection fees only, tenant pays ALL bills
  • I am a self employed electrician with an income after all expenses and taxes of £20,000 per year, I pay my partner £1,000 per month for my share of the bills etc
  • Total money in bank at the moment £15,000

Cheers

Alan



Comments

Mark Alexander

9:52 AM, 22nd March 2015
About 4 years ago

Hi Alan

A few questions if I may please ....

1) Did you get a clean break order with your divorce

2) How much is your property in Dartford worth

3) Are there any early repayment charges on your Northern Rock mortgage

Once you have answered these questions I, and other members, will be in a far better position to suggest expansion and financial strategies.

Just one glaringly obvious point I've noticed is that £45 pcm for rent collection alone is rather expensive. Please take a look at this link to see the level of service that you could be benefiting from for less money money >>> http://www.property118.com/letting-supermarket-amend-pricing/68829/

Another area that you could be saving money on is insurance - see >>> http://www.property118.com/landlords-insurance-landlords-buying-group-2/
.

John Constant

11:40 AM, 23rd March 2015
About 4 years ago

In advance of the questions outlined by Mark above, I would just like to say that lenders are getting jittery about landlords with no residential property of their own (I assume that you are living with your new partner, but are not named on their mortgage). The reason that lenders are wary is that the borrower could take up residence in the BTL mortgaged property, which is a big no-no.

This is not to say that all lenders will not do this, but I would say that a majority do now.

I assume that you also have Consent to Let from Northern Rock/Virgin Money if the existing mortgage is still a residential mortgage.

Alan Moller

14:34 PM, 27th March 2015
About 4 years ago

Hi Mark,

Apologies for delay in coming back.

Yes i did get a clean break order. Property is worth £250,000 and early repayment charges would be £0.00 probably due to being on a svr (4.79). John- Please explain the "consent to let" details please?.

Cheers,

Alan

Mark Alexander

19:36 PM, 27th March 2015
About 4 years ago

Reply to the comment left by "Alan Moller" at "27/03/2015 - 14:34":

Hi Alan

Based on what you've said I think you are in a very good position to grow your portfolio and would suggest to arrange a meeting with John Constant, who has commented above. If you click on his name it will link you to his member profile. He has a contact form there.

Please let me know how you get on 🙂
.


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