A Few Vital Tips Needed to Compare Buy to Let Mortgages
Buy to let is an example of a property investment strategy where the investor purchases a property with the sole intent of renting it out. There has been a number of reasons in the past few years why buy to let has become popular including a rise in property prices, tax benefits for investors and the availability of buy to let mortgages.
How Buy to Let Mortgages Work
In general, buy to let mortgages are only slightly different from the other standard mortgage agreements because they focus on a property’s investment value and less on the investor’s income and assets. Most buy to let mortgages require higher down payments than common on traditional home purchases.
Just as seen all throughout the mortgage industry, there are a number of different types of buy to let loans available. Some of the most popular include interest-only buy to let mortgages which require the homeowner to pay only interest, no principal, for the life of the loan. Upon the sale of the home, the principal would be paid in full. This type of mortgage is quite beneficial for an investor who expects significant increases in home value in the near future. In order to compare buy to let mortgages, you must know a little about what to look out for.