I have a property that has no mortgage and is let. Can I borrow against it?
Posted on 25 June 2014 by Manda
I have a property that has no mortgage and is let. Can I borrow on the property?
Within certain parameters there's no reason why you cant borrow against your unencumbered rental property.
Most Buy To Let lenders cap the borrowing at 75% of the property value, and also need the rental income to be at 125% of the monthly mortgage payment at a notional rate of typically 5%. Some also require that you have a minimum level of earned of self-employed income, though this is varies, as lenders are now tending to focus more on a borrowers overall indebtedness and how they would support any rental voids, should they occur. Another piece of criteria is that a number do require you to also be an owner occupier as well.
I think it would be looking at your options in a bit more detail, and you can do this by contacting one of our consultants on 0344 346 3672, and they'll be able to give you a much clearer picture of how we can help you.
More than mortgages, talk to me about: Financial Protection | Investments | Personal and Corporate Pensions | Home Insurance General Insurance | Valuations | Conveyancing | Wills | Home finders
Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.
We recommend you seek professional advice with regard to any of these topics where appropriate.
YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY DEBT SECURED ON IT.
John Charcol is a trading name of John Charcol Limited and its Appointed Representatives. John Charcol Limited is authorised and regulated by the Financial Conduct Authority. The Financial Services Register number is 665649. Registered in England No. 9157892. Registered office address for John Charcol Limited is 5th Floor, Cutlers Exchange, 123 Houndsditch, London, EC3A 7BU. The FCA does not regulate some investment mortgage contracts. Calls may be recorded for training and monitoring.