I've posted this already in the General Forum ... Looks like I should have posted here .. oops .. apologies for duplicate post.

I'm hoping you can give me some advice please ....


I've lived in my council flat for 9 years. I purchased it for £17,000 and my mortgage is £25,000 ... It's currently been valued and on the market at £73,000.00.

I've had an offer accepted on a property at £115,500.00.


My flat has been on the market now for 3 weeks and I've had three viewings and two offers on it, (which I've refused because they've offered way below the asking price). The 2 that offered to buy my property were wanting it as a buy to let. So, I'm thinking .... would it be worth my while keeping it and using it as a buy to let ! I don't know the ins and outs of buy to let and I'm really not sure if it will be feesable so I'm here to ask you good people for advice.

I was planning on selling my flat and using £40k as a deposit for the new place but now I'm thinking I could re-mortgage and release £40k of equity as the deposit.

Could someone please give me some advise/info on buy to let.

Going on my figures above .. what do you think ?

Bearing in mind I have no savings to fall back on. I also have until May to move into my new property and either sell my own .. or find tenants.

Thanks in advance.

This is a really good idea to re-mortgage as btl and withdraw the equity, find a tenant and thus begin your lettings business.

BUT, firstly, do you have a rental market? Talk to letting agents, look in the property post to find comparables. The key figure is your rental per month figure, this will dictate how much a btl lender will lend you on the property. This simple sum MUST stack up, or you will be left with no mortgage offer or worse a mortgage shortfall.

Secondly, you must also work out if you will have enough savings left over to pay for btl insurance on the property, agents fees, void periods which hopefully won't be too many, but nevertheless... tuck away 4-6 months payments just in case. If you have NO CASH leftover as a buffer, it's a non-starter. So get your calculator out!!

quote:

Originally posted by captainpugwash:
This is a really good idea to re-mortgage as btl and withdraw the equity, find a tenant and thus begin your lettings business.

BUT, firstly, do you have a rental market? Talk to letting agents, look in the property post to find comparables. The key figure is your rental per month figure, this will dictate how much a btl lender will lend you on the property. This simple sum MUST stack up, or you will be left with no mortgage offer or worse a mortgage shortfall.

Secondly, you must also work out if you will have enough savings left over to pay for btl insurance on the property, agents fees, void periods which hopefully won't be too many, but nevertheless... tuck away 4-6 months payments just in case. If you have NO CASH leftover as a buffer, it's a non-starter. So get your calculator out!!

Thanks Captainpugwash

After a great deal of thought and doing my sums .. I've decided against the btl.
I would have two mortgages totalling £145,000.00 which is way more than I'm currently paying.

You make it sound so appealing .. and it probably is .. just not for me .. in my situation.

Thanks for your feedback