Other Types of Lending

Self Build Mortgage

If you are building a new house, some schemes offer you a stage payment facility, so as the work progresses the funds will be released to you (subject to inspection and pre-agreed terms). When the property is finished and occupied by you, you will be able to apply for a mortgage product from our current range, subject to eligibility.

Buy to Let Mortgages

A Buy to Let Mortgage allows you to purchase residential property for letting purposes. However, purchasing a property for letting purposes is very different to finding a home for yourself. This is an investment and you need to evaluate whether this would be suitable by taking into consideration the following:

Investment Objectives

Before looking at properties to let, you need to ensure that you have a clear focus in terms of who you want to let the property to, for example professionals only or families. Once you have a clear target market in mind you need to consider what locations would be the most attractive to these tenants and what amenities are nearby, for example if your target market is professionals you would need to consider areas that have good transport links.

You will also need to consider what condition a property is in, do you have the time and the money to make extensive improvements to a property? You will also need to consider the potential delays in letting the property if work needs to be completed to ensure it is safe and in adequate condition for tenants to move in.

Affordability

The Society will assess the affordability of the mortgage based on the expected monthly income generated from letting the property. The actual income generated may differ, and changes in the rental market could influence this as time passes. For the duration of the mortgage, you remain responsible for meeting the costs of the mortgage and the additional costs incurred through letting the property. If you have an interest-only mortgage, the total amount borrowed will need to be repaid at the end of the term.

Responsibilities of a Landlord

As a landlord you have extra responsibilities and legal requirements such as the requirement to have an Assured Shorthold Tenancy (AST) agreement in place between yourself and the tenant(s). Also, it is important that the landlord obtains a deposit (or bond) from the tenant before the tenancy commences to secure the property and protect it against minor damage. Landlords are legally obliged to protect their tenant(s) deposit using a Tenancy Deposit Scheme (TDP).

Landlord’s Legal Obligations

As a landlord you have a legal responsibility to maintain the property inside and out, ensuring it (and its contents) complies with the recommended safety standards e.g.boiler, gas appliance(s), electrics and so on.

Property Insurance

It is vital that the landlord has an insurance policy in place for the let property. As part of the terms and conditions of the mortgage, you must ensure that there is buildings cover in place at completion and throughout the term of the mortgage.

For more details on the above, please refer to our Buy to Let leaflet.

If you don’t keep up repayments on your Buy to Let mortgage, a receiver of rent may be appointed and/or your rental property may be repossessed. Any shortfall after the property is sold would remain your responsibility.

 
 


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