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Consumer Buy to Let – this is when you have lived in the property as your main residence or you inherit a property that was a main residence and then due to a change in circumstances you choose to let the property and you receive no other rental income. Intermediaries must hold appropriate FCA permissions
Regulated Buy to Let – this is when you or a member of your family will at some stage be a tenant (this also applies to Holiday Buy to let where you or a family member expect to rent the property at some stage)
Business Buy to Let – this is where the transaction does not merit either of the criteria above and is purely a business transaction to generate income and yield
The Melton’s standard ICR (Interest Coverage Ratio) calculation is 145% of the mortgage payment, calculated at the Society’s BTL stressed rate of 5.5% on an interest only basis (4% for 5 year fixed rate products).
This calculation is reduced to 130% for our Holiday Buy to Let products.
Applicants must have a minimum earned income amount of £25k. This can be shared between joint applicants. Evidence of income is in accordance with our standard proof of income requirements.
A maximum portfolio of 3 properties in total in mortgage to the Society or any other lender will be allowable to an individual or connected counterparty. The maximum amount that may be lent to any individual or connected counterparty is £500k in aggregate.
Leasehold properties will be considered up to a maximum loan to value of 60%.
The EPC rating for the property must have a minimum of grade E.
Many landlords who are looking to buy a property to rent to a family member will know it’s not easy, however at The Melton we offer a Family Buy to Let mortgage allowing just that. This mortgage is also available to customers who are intending on letting the property out to non-related tenants in the short term but moving in themselves at a later date.
Our Holiday Buy to Let mortgages continue to remain popular, especially due to the fact that we offer a regulated product allowing the applicant(s) to holiday in the property themselves.
Gross rental income must cover the mortgage payment (calculated at the the Society’s BTL stressed rate on an interest only basis) by a minimum of 130%. For the purpose of HBTL, gross rental income shall be;
The property must be free of any planning restrictions that limits use to holiday home use only.
Details of any company managing and/or marketing the property will be required and the requirement for an assured shorthold tenancy agreement is not applicable.