Rental income and personal mortgage

by Readers Question

10:57 AM, 6th May 2015
About 4 years ago

Rental income and personal mortgage

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Rental income and personal mortgage

What affect does having a buy to let portfolio have when you apply for a personal mortgage? Rental income and personal mortgage

I work full time and if I choose to move I could put down a 40% deposit on the sort of property I’m looking at. In addition rental income adds another 35% to my income.

Is having so many mortgages seen as a bad thing when it comes to your own mortgage requirements?

Regards

Sheridan Whiteside



Comments

Mark Alexander

11:00 AM, 6th May 2015
About 4 years ago

Hi Sheridan

Several of our members are mortgage experts so I have invited a handful of them to engage in this discussion.
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Howard Reuben CeMap CeRER

11:12 AM, 6th May 2015
About 4 years ago

The quick answer is .... it depends!

Each lender has their own take on what's acceptable, so at the time when you're ready to proceed and need to research your specific and personalised options, you should work with a professional mortgage adviser to determine your eligibility for the available products.

It also depends on the interpretation of 'portfolio' and how much of your total overall income (as a percentage) is made up of rental income.

Again, different lenders take different views on this.

When the time is right, your mortgage broker will carry out a fact find snapshot of your current circumstances and requirements and will then research the lenders and their products for you. Until that time, you'll only get generic insight and as lenders, products, criteria and service levels change on a daily basis, that generic info could go out of date very quickly.

Howard
http://www.property118.com/member/?id=314

Pete Lindley

13:14 PM, 6th May 2015
About 4 years ago

I am not a broker of any sort, just an investor with a shift work job.

Currently in the throws of purchasing another residential property for ourselves with the aim of keeping our current property to rent out after we move. We have several other properties on BTL.

It seems that a lot of mortgage companies don't use your rental income (net or gross) as income. They do seem to want to ensure that the rental profits do cover the rental properties and enough left over to build a reserve pot for emergencies, all without any outside financial help from yourself.

I would however assume that if the properties were unencumbered, then they would be more likely to take a percentage of the BTL income as a personal income.

sheridan whiteside

14:22 PM, 6th May 2015
About 4 years ago

Thank you for your replies.I was hoping just to use my salary as the basis for securing the loan and disregard my rental iincome I pay around 30% of the rent in mortgage payments and maintenance,so its a reasonably stable income, I am concerned that with stricter lending.having mortgaged rental properties maybe an unhelpful complication

Mark Alexander

14:28 PM, 6th May 2015
About 4 years ago

Reply to the comment left by "sheridan whiteside" at "06/05/2015 - 14:22":

Hi Sheridan

Have you found a property you would like to buy yet?
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sheridan whiteside

15:39 PM, 6th May 2015
About 4 years ago

hi Mark
No, not yet.

Mark Alexander

15:41 PM, 6th May 2015
About 4 years ago

Reply to the comment left by "sheridan whiteside" at "06/05/2015 - 15:39":

OK, in that case Howard's reply is probably about as good as it gets at the moment. Well worth contacting him when you are seriously ready to move forward with this though.
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