Best Buy to Let Mortgage Quotes

Want to increase your profits as a landlord? Yes. Well read on and see how you can. Finding the best buy to let mortgages is one of the key factors in successful property investment. And whilst the Bank of England base rate is retained at just 4.5%, now is still a very good time to be considering property investment or simply refinancing any buy to let properties you already have to release equity for future purchases.

It would be easy to start saying just how easy it is to become a landlord and earn income from UK investment property and how you can simply sit back and watch the profit tumble in like a cascading waterfall.



The reality is that there are a number of key issues that you will have to be involved in to ensure your investment property portfolio works to its optimum. With tenants to source and vet, an investment property to maintain, buy to let mortgages to arrange, letting agents to manage and accounts to monitor, it does take a certain level of commitment. Sourcing the best buy to let mortgage quotes can in itself be a very time consuming exercise and Landlords often opt to use a buy to let mortgage broker to do this work on their behalf.



There are many different buy to let mortgage products available so it is worth getting a few of the best buy to let mortgage quotes available as different lenders will offer different rates and products and these can depend on the type of investment property in question and the employment status of the applicants. So if you are still keen to have a slice of the much talked about property game then you will want to read on to find out how to get started?

PROPERTY MARKET 2006

Despite the negative press that the housing market experienced at the beginning of 2005, the recent reports for 2006 are showing a much brighter outlook for property investment.



There is of course the question of what will actually happen in 2006 and the property market. It is never a precise prediction as there can be many influencing factors but what we do know for certain is that over the last few months we have seen interest rates stabilize and property pricing stablising as a result of this. It is unlikely that we will see double figure inflation prices on property in the next few years but many are suggesting at least a 5% increase year on year for the forseeable future.



So does that mean we should avoid investing in property until the market starts to increase dramaticallyagain. In some respects many people might suggest that investing in property at any time is a good investment. When you consider that historically property in the UK has doubled in value, and sometimes tripled in value, every last 10-15 years, then it is likely to see you a good return on your investment if you are prepared to take a long term view. Plus, there still remains a high level of activity from Landlords and investors alike with a number of buy to let mortgage providers suggesting record levels of applications being received.



For those looking for a get rich quick overnight scheme, then this is not for you. But when you consider the long term gains, it might be worth reading on and don't forget that it is worth doing plenty of research and finding out as much as you can about investing in property. Perhaps pick up a Free Buy to Let Guide.

How to make ฃ166,500 in 15 years

According to research from the Centre for Economics and Business Research (CEBR), the average cost of a home in the UK could be ฃ300,000 by the year 2020.



Currently that figure stands at around ฃ157,000 in 2005 which represents an increase over the next 15 years of 91%.

This figure of ฃ300,000 is achieved by the economic forecaster basing its prediction on the ever increasing population compared to a slower production of house building. As with many commodities, it is the result of lower supply and higher demand that will push up these prices.

With buy to let residential investment property, the maximum loan you can apply for is 85%. Based on an average value property in 2005 of ฃ157,000 this would require you to put down a deposit of 15% ฃ23,550 subject to valuation and rental cover which can vary between 115% to 130% in most cases.



Potentially over the next 15 years, this one investment could realize a return of ฃ166,550. This is based on selling the property at ฃ300,000 less the loan of 85% of the property value in 2005.

Over previous years there have been times when property has declined in value and other times where it has signifcantly increased in value but a good property investor will clearly see the benefits in both a rising and declining market and will utilize the facilities of a good buy to let mortgage provider to assist in this.



For example:

During a rising market, a property investor may decide to use this window of opportunity to release some of that equity realized in the value of the property, to use for additional property investment. However, the property investor is less likely to use that capital released during a rising market. Instead, the landlord will wait until the market has re-stablised itself or experiencing a decline. At this point, they will then use this window of opportunity to purchase lower priced property and the circle continues.



That is why property investors are in it for the long term and why they see the market as being profitable to them in all conditions. And when you consider that property prices only need to increase by an average of 4.4% year on year, it is easy to see why this type of investment is so achievable.

Successful property investors will do a lot of research on areas that they believe will become property hotspots and areas which are less likely to perform. There are many areas experiencing high levels of growth with substantial financial investment with a lot of regeneration programmes in place or planned in the future.



Even by simply monitoring publications such as Construction News can give a good indication of where new commercial premises are being built which can be a good indicator of new businesses moving to the area which in turn can lead to an increase in demand for property locally.

It is the general consensus that interest rates have stablised and there is even speculation of a drop later in the year but either way, they have been steady for a good number of months now. Slower capital growth does result in buyers having to put more effort into managing and developing their portfolios.



And more importantly making a profit from property. Buying property at discounted prices can be done but you must do your homework to make sure they are genuine discounts and incentives. And don't forget that in a slowing market, vendors will be more likely to listen to your offers. Albeit if they are a bit cheeky. In particular, you can use the negative press that is often surrounded by the property market to your advantage. For example when the media are circulating stories of a dropping property market, then vendors are even more keen to listen to your offers.



How to Get Started in Buy to Let

• Do as much research as you can. You can even get some free publications including Free Buy to Let Guides

• Find out what properties are selling for. A good way of doing this is by contacting estate agents and researching on the internet. A good way is to look at property house price websites.

• What is the level of demand for rental properties in the area

• What type of property is most in demand. For example, if it is a university city, then the demand for shared student accommodation may be much higher than property for professional sharers.



• Find out what rent is being achieved on those properties and the likely time to get the property let out. Speak to letting agents and local businesses that may be letting properties already in the area.

• Raising deposits for your investment properties, may be easier than you think by releasing equity from any of your existing properties.

So how Do you know if you have bought a good investment

Well there is always an element of risk but providing you follow the main logic you should eliminate most of them.



It is also important to make sure you continue to review your buy to let mortgage funding on a regular basis as this can have a big impact on your success and cash flow. As we have said above, the property market can rise as well as fall so providing that you have some cash funds in the bank to help you through any tougher market conditions then you could reap the rewards in years to come. But it's important that you calculate these carefully into your projections to ensure that whatever funding you may need to input into the investment property that it will be outweighed by the eventual gain.



Providing that you are buying a good quality property in a good area with strong rental demand then it's worth considering. Don't just buy a property because it is cheap. You might buy a property at a very discounted price, but if you can't let it, you could find yourself covering the buy to let mortgage payments for months to come which will see a big dent in your profits. Find out why it is cheap. Is there an increase in crime in the area, have plans been submitted for a large industrial unit to be built behind the garden etc, etc.



Do your research. And don't be afraid to develop a property for profit. Buying at the right price, in the right area and doing the right renovation on the property, can also see you return a decent profit. Re-financing the property on completion and letting it out could give you the best of both worlds.

Having taken into account all the considerations above, to calculate if it is a good investment, you need to ensure that your annual rental income exceeds the cost of your monthly buy to let mortgage repayments and maintenance costs.



And it is more likely that your annual rental income will be stronger if you select an investment property in area with a strong and growing rental demand as it is less likely that you will experience rental voids and be supplementing the monthly buy to let repayments.

Firstly, you need to establish if this is the right time for you to become a landlord and how much it is going to cost you. Can you afford to tie up money in a property? If the worst comes to the worst, can you afford to lose that money?

The simplest way to work out the repayments on a buy to let mortgage is to use an on-line buy to let mortgage calculator.



These can help you work out the best buy to let mortgage product for the type of UK investment property you are considering and your individual circumstances. You will need to know the likely rent that can be achieved for the property as this will determine the maximum loan amount available against the purchase price or refinancing value of the buy to let property. Lenders normally suggest that the rental income each month represents at least 130 per cent of the monthly mortgage payment.



Although there are some buy to let products calculated on ratios of as little as 115%. By working on these calculations, gives the investor a margin to cover the letting agent's fees and other associated costs.

This is a long-term investment and you need to take the same approach to investing money into a house or flat as you would to buying into the stock market. Historically the value of properties have doubled every 10-15 years but that doesn't mean to say that there won't be peaks and troughs in between.



These are times that you have to be prepared and most importantly can afford to ride through.

Increasing your returns by using buy to let finance to your advantage

For example, lets say you have ฃ100,000 cash to invest into Investment Property. Is it best to buy a property outright or use this money as deposits on multiple buy to let properties?

Mr Jones - decides to use his ฃ100,000 to purchase a brand new property outright for cash. He lets the property for ฃ600 per month giving a return of ฃ7,200 per annum.



Due to inflation, the rent will increase accordingly and eventually, after fluctuations in the property market, the house doubles in value.

Mr Smith - decides to use ฃ100,000 as deposits (15% for each investment property) to buy ฃ500,000 worth of properties similar to the one Mr Jones bought. This results in Mr Smith receiving five times as much rental income, i.e. ฃ3,000 per month or ฃ36,000 per annum. The other ฃ400,000 is borrowed on buy to let mortgages and Mr Smith pays interest on this at a rate of approximately 5%.



These monthly interest only repayments would work out to be ฃ20,000 per annum. Therefore, net of interest they receive ฃ16,000 per annum. Mr Smith is already better off than Mr Jones….. but what happens in years to come? Well it is probably safe to say that Mr Jones's rental income will rise with inflation as per Mr Smith. However, Mr Smith's buy to let mortgage costs remain the same. Therefore, the gap between Mr Jones and Mr Smith's rental income will continue to widen as time goes on.



And finally after 10-15 years when property could have doubled again. Mr Jones would have made a capital gain of ฃ100,000 and have ฃ200,000 worth of investment property. Whereas, Mr Smith would have made ฃ500,000, which is five times as much capital gain!!

The most successful landlords will use some of the best buy to let mortgages to fund their buy to lets and with buy to let mortgage products becoming more sophisticated and competitive the best buy to let mortgages can ensure you maintain your investment property portfolios in such a way that you are always working to the most optimum cashflow situation.



Best Buy to Let Mortgages

Finding the best buy to let mortgage is crucial to your success as a property investor. Unlike other forms of investment, a lot of the money you put into a buy to let property is likely to be borrowed. Over the last few years, the buy to let mortgage market has boomed, and borrowing money to invest in this way has become easier than ever. There are a number of different buy to let mortgage products available from fixed rates, discounted variable rates, discounted rates and so on.



Different products may be suitable for different investment properties. And don't be tempted to just go for the cheapest buy to let mortgage as there may be penalties that make it less attractive in the long term.

Always find out the best buy to let mortgage deals available at the time. Some investors may decide to retain their entire portfolio with one lender, but it's important to realize that different buy to let products between different lenders can provide you with maximum flexibility and cashlow depending on how you structure your funding.



However it is very important that you get the correct guidance with your buy to let finance. You will often find that buy to let mortgage brokers have access to numerous different products and lenders and some can even offer exclusive products that wouldn't necessarily be available to you if you approached the buy to let lender directly.

Questions that are worth considering when finding the best buy to let mortgage:

1. Do they have access to lots of different products in the market place?

2.



Do they have the ability to create a long term property development strategy for you?

3. Are they able to secure Exclusive Products?

4. Are they able to arrange mortgages within 10 working days?

Most buy to let lenders will offer a maximum loan of 85% requiring you to fund at least a 15% deposit towards your UK investment property. The buy to let mortgage industry is very competitive with new products being launched on a very regular basis.

Some buy to let mortgage brokers may charge a brokerage fee up to 2% to arrange the buy to let finance for you but don't let this put you off because if they do have the ability to secure exclusive products for you, it could be very beneficial to your cashflow as a landlord.



Plus, if they are able to reach formal mortgage offer stage in a very short space of time, this could result in you being able to secure the investment property at very competitive prices if you have the ability to tell the vendor that you can have the deal completed within a matter of a few weeks.

How much you can borrow for the buy to let property will usually be worked out differently to how much you can borrow to buy your main home. Different lenders and different products carry different criteria for working out the maximum loans available.



Some will lend on how much you earn, others on the rental income you achieve from the investment property. And sometimes a combination of the two.

How much rent will you make?

Before you agree on the purchase price of a buy to let property, it is important to find out from local letting agents, what the likely rent could be. They should be able to let you know which types of property are in highest demand and which areas are the most sought after for tenants. If you need to find out whether your potential buy to let is looking like a good investment, ask your broker/lender to work out the yield (ie the money you are investing and the rental income you will receive) on the property against what your repayments are likely to be.



I you are investing in an up and coming area, it could still be a viable investment despite the figures not looking too healthy today. If you believe that the area will be having a lot of other investment or new businesses moving in, then there is the possibility that the surrounding property market will have a positive knock on effect. When the valuation is carried out on the property, the surveyor who visits the property will also be expected to give an assessment of the expected rent as well as the value of the property.



A local letting agent is the best person to approach for this kind of information - especially if you hint that you might let them be the property's management agent.

So in conclusion the property market is likely to remain a prime choice for property investors as long as they are will to commit to the long term.

Jennifer Tweed is the founder of http://www.buytolet4sale.com, one of the UK's first property portals solely dedicated to advertising investment property for sale. You'll also find an on-line mortgage calculator, FREE Buy to Let Guide, Investment Property for Sale, Tenancy Agreements, Landlord Insurance, and more .



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Mortgage Sales, Leads Come In Many Varieties

For loan officers and mortgage brokers we are constantly on the look out for leads. Here are a few ideas to obtain more of them.



By far, your family and friends are your best source of lead referrals. Be sure to make your family and your entire circle of friends aware of the fact that you are working in the mortgage industry and make sure they have a supply of your business cards.



And don't be shy, tell them you expect referrals from them.



Customer referrals are also a good lead source.



So be sure to treat every customer with respect and excellent customer service and you can guarantee they will refer you when someone mentions they are looking to purchase or refinance.



Again, don't be shy, after you close their loan, ask them to refer you if they know someone who is in need of your services.



Networking groups such as your community's Chamber of Commerce or your local lions club usually meet once a week at a designated restaurant for lunch. It would be a good idea to join a few of these groups to get your name out there, and it is also a good way to keep your business cards in circulation.



And, last but not least, mortgage lead companies. This isn't such a bad idea for new loan officers, only because you are new to the business and haven't had an opportunity to build up your book of business to this point. This is a great place to begin.



If you are a seasoned loan officer, mortgage lead companies are a good way to jump start your business during a slow time such as holidays and the summer months.



If you do decide to go with a mortgage lead company, look for the mortgage lead companies that sell their leads in "real time," this way you will be receiving fresh leads, and you will be able to count on their quality.

Mortgage Calculators - Bring Into Play Mortgage Calculator Before Initiate Your House Hunt

If you want to be familiar with anything on your monthly mortgage payment, in that case you have to be familiar with how to make use of a mortgage calculator. It is the most excellent device you will find to work out the most excellent mortgage payment choices for you. You are supposed to embark on by working out your entire monthly obligations against your monthly wages and consider the amount you can manage to pay for a monthly mortgage payment.



After you have completed that, you have to confirm the present interest rates in order that you come across a precise figure.

At present, the best place to find a mortgage calculator is the internet, you can log on to any to the net and search for a free online mortgage calculator with the help of your favorite search engine to see the amount you can manage to pay for the monthly mortgage payment. Enter the lowest interest rate you found and an approximate cost for a home that you would like to have.



Subsequently make use of a 30-year term to begin with and observe the results. The calculator will provide you with a monthly mortgage payment amount together with principal as well as interest.

These online mortgage calculators are more often than not free therefore you can go on using it until you arrive at a figure you are contented with. If the initial figure you crop up with was, lower than you can manage to pay for in excess of you thought, then you can raise the loan amount or reduce the amount of years you would like to pay it over.



You certainly would like to obtain a fixed rate mortgage in this instable market therefore; I do not advise altering the interest rate. On the other hand, you are supposed to lower the loan tenure to 15 or else at the most 20 years if you are able to since you will repay the mortgage a great deal earlier and pay a great deal less in interest.

Re-examine the mortgage calculator and bring into play the two to three preeminent conditions you discover with an amortization program.



This will give you an idea about you the amount of principal you are paying each month that is the lone thing that reckons. In addition, remember interest, points, taxes, insurance and closing cost are all waste of your hard earned money in the end. The principal amount is what you get once you decide to sell off your home therefore; you would like to confirm you have more than enough, going towards your mortgage balance. In other words, you should look towards building your home equity.



A higher monthly payment is excellent provided that the additional money be diverted toward principal amount and building home equity. On the other hand, if it is diverted toward interest then it is not good enough. Even though you obtain the 30-year mortgage you can still pay additional principal every month therefore do not be disheartened. Make your goal to build up equity in your home and you will soon find the home is yours in no time.

Mortgage 101: First Time Home Buyers Must Read!

There is so much information available to the first time home buyer both on and offline; there really is no excuse for the home buyer to not be educated when going into the mortgage buying process. However, it can be difficult to gather all the mortgage facts and terms into one easy to understand, compact guide.



Here I have gathered the basics of a mortgage and what it involves. This is a broad overview and it will give you the "big picture" regarding mortgages and the mortgage process.



Use it as a general guideline as to what should occur when you purchase your first home.



After finding a home that you feel is in the right community, has the amenities you want, room enough for your family, close to freeways and good schools, or whatever it is that is important to you and your family, and within your price range, it is time to put an offer in with your broker.



During escrow, or the time where funds are founded to purchase the house, you will meet with your real estate agent or broker, who may have suggestions for a mortgage lender.



A mortgage lender is an entity that actually provides you the funds to purchase the property. Mortgage lenders can be commercial banks, private lenders, mortgage banks, and many other entities that have the ability to finance your purchase.



You can use the mortgage lender that your agent or broker provide, or you can ask them to shop more lenders that may get you a better deal. A broker is usually in contact with many different lenders so that they may be able to work out a better deal than you shopping yourself.



Another option is to shop mortgages yourself. This will take a lot of time and energy, but you may find an option that works best for your financial situation. Using online services can be a great way to shop and compare mortgages.



After you have found and discussed basic terms with your mortgage lender, it is time to put in an application. This application will include your credit history, total income and expenses, as well as any short and long term debt.



Needless to say, the better financial environment that you have, the better deal you will be able to obtain.



You and your mortgage lender, or broker, will discuss the terms of a mortgage including mortgage rate, life of the loan, payments, fees, and any other contingencies such as prepayment penalties or Private Mortgage Insurance.



The mortgage rate is the amount you will pay in interest for borrowing the money, and it dictates how your monthly payments are determined.



For example, you may choose a fixed rate mortgage where the interest rate, as quoted by your lender, remains the same for the entire life of the loan, or how long the loan will last. This could be anywhere from 5 to 40 years depending on your financial arrangement with your lender. If you choose an adjustable rate mortgage, then the interest rate will fluctuate according to the current market rate at the time of the change.



Another option to be considered would be a bi-monthly payment, where you take a single monthly payment, divide it in two, and pay every 15 days rather than 30 days.



This will yield approximately two extra payments a year, building the equity in your home faster, and saving you money in interest!



There are many terms to be discussed regarding the mortgage. Besides mortgage rates and interest rate, life of the loan, and payments, you may discuss Private Mortgage Insurance and prepayment penalties.



Private Mortgage Insurance (PMI) is extra insurance paid by the home owner in exchange for not putting down at least 20% of the property purchase price.



This assures the mortgage lender that you will pay back all the money. It often results in thousands of extra dollars, so it is recommended that you negotiate not to have PMI or wait until your finances are in a better position to pay a larger down payment.



Prepayment penalties are fees paid to the mortgage lender if the home owner chooses to pay off the mortgage before the life of the loan is complete. The fee is usually a percentage of the final amount owed on the property.



This too can be negotiated not to a part of the mortgage agreement.



After negotiating the terms of the mortgage, and filling out the application, you either qualify or don't qualify for the loan. If you do, congratulations and welcome to your new home! If you don't, don't worry. There are many mortgage lenders out there who would like your business. If it is a financial issue, find a mortgage lender who works with difficult cases.



Ask for the exact reason why you did not qualify, and try to rectify the problem or find someone who might give you a higher interest rate or more strict terms in exchange for financing a higher risk loan.



Here is your crash course in mortgages. You should have a good idea as to the process, and the most important elements of a mortgage. Continue your research and education so that the process runs more smoothly and you have a better chance in getting the best deal for your situation.