There have been a number of remortgage applications recently for those looking to raise funds to purchase other properties or to make improvements to their current homes. Just around the local area, I have seen an amazing amount of building work and renovations / extensions being carried out. Many home owners appear to be improving their current residence rather than taking the big leap of selling and moving up (or down) the ladder. This appears consistent with the general view that there is a shortage of properties up for sale.
Other consumers might be making the next step but are then renting out their current property on a Buy to Let basis rather than selling it. Nice if you are in that lucky position! The rental market is certainly buoyant and showing no signs of slowing down over the coming months. So a Buy to Let might provide you with a modest return for your investment and may be the start of building a little portfolio nest egg for later on life. We have noticed that this is a growing desire for many who fear that their pension arrangements may not be sufficient, and that rental income may be a suitable supplement. Many new lenders have also launched into this sector over recent months and re-mortgaging away from your current lender should not be looked upon negatively.
Many lenders will cover the cost of surveying your property, as well as covering the legal fees in transferring your mortgage from one lender to another. But most of all, you should think of number one as this could save you money against your current provider. This can only be a good thing.
Finally, once you have more than four properties, the regulators/lenders class you as a ‘portfolio landlord’. Although each lender’s requirements are different, in the main, this entails a more in-depth investigation and underwrite of your situation. Common requirements are now a Business Plan, a Cashflow and forecast, Assets and Liabilities statements and full details on the whole portfolio including current mortgage, value, rent achieved, etc. Be aware if you are in a rush as this underwrite can take a little longer than a standard mortgage process.