To let mortgage best rate

Questions and Answers

What is the best current buy to let fixed rate mortgage at the moment?

Q) Looking to purchase a small property in the region of £100,000 and have 10% deposit avialable. I am looking for interest repayment only over a 20 year period.

A) If you check out moneyfacts.co.uk you can enter what you are looking for and it will give you tables of top 5, and you can change to be best rate, true cost, no fees etc, so you can look for exactly what you want. It should also tell you what LTV (loan to value amount) that each company will allow - ie what deposit you would need.

Anyone know who's offering the best rates on a buy to let interest only mortgage?

A) Sorry, I don't keep up with the rates...but - there are very few occasions where an interest only loan is the right move. If an interest only loan is the only way to afford the payment, then the price is beyond your means. Look for a less expensive property.

My ex partner lives in the house we bought together.Been told to take out buy to let mortgage, should i,can I?

Q) I have a son with her and therefore I continued to pay the mortgage so my son could continue living there and this replaced me paying child maintenance. Now finding it hard to get on property ladder again and she won't move out, buy me out or let me be her out. Spent £3000 on a slicitor and got nothing other than parental responsibilty, which of course is great, but got nowhere regarding the house. Can't even get a decent mortgage lender to give me a good fixed rate as I don't live there. I have recently been told to go for a buy to let mortgage, but unsure if I can without her signing something and unsure if this is the right way to go. Left two and a half years ago and it pissing me off. She living rent free and my monthly repayments keep going up. Any ideas??

A) If you own it, and have not signed anything giving her possesion, live there. Enjoy your child, and the rest of your house. If she doesn't like it, she can move.

Do I have to change my mortgage to rent out my property?

Q) So I'm on a fixed rate mortgage for five years, but I was thinking of buying another property and moving to that, and renting this one out. Do I need to change my mortgage to buy to let? Or can I just rent my property out and get the tennant to sign a contract etc?

A) You HAVE to inform your lender, your current mortgage may state that you are not allowed to rent out the property without their prior consent. If you do rent out the property without their consent, you are in breach of their terms and could lose the property In any event, It may also be a good time to re-mortgage but if you so, ask for a buy to let....much better interet rates at the moment.

what would the repayment be of a £200k 20 year mortgage?

Q) Show your working please :) Let's assume we're working just on bank of england rate, not a mortgage rate.

A) assuming 5.25% rate ( you can get better) approx payment would be £1348 per month suggest you talk to an independant mortgage broker - they usually don't charge a fee for a chat - but there may be a charge for their advice and dealing with an application - make sure they are independant and not, like most, have access to a limited number of lenders - as believe it or not, not all lenders offer their mortgage deals via brokers

Just bought a property, buy to let ,is it best to pay interest rates and hope value goes up or to pay full mo?

Q) Hi, is it best for me to pay fort he full mortgage ok 70k with tennant or just to pay interest rates and add value to the house and sell? Only got 1 property under my belt and not sure what to do for the best outcome. Thanks

A) Hi, in south wales property has started to steady out and some reports of 2-3 % downturn in prices over the last month although i haven't noticed. the answer to your question all depends on how long you intend to own the property for. If for example you see it as a long term investment (which i hope you do!) i would recomend you just pay the interest and leave yourself with extra money to maybe save for another buy to let. this is because, rental income will not decrease even if the housing market does, houses on average increase by around a third to 40% every 7 years so your interest will be paid through letting the house then when you come to sell it in the future the propert will have increased. if however you are not thinking of holding on to the property for a long period i would go with repaying the borrowed amount as houses might start to drop and you could be left out of pocket. i would also recomend getting a shorter term morgage, maybe 15 years instead of 25 as this will save you an absolute fortune. But you probably know that! hope this helps

What happens if i de-fault on mortgage payments for an investment property.?

Q) recent interest rate rises and property value falls (in a specific area) have resulted in the rent collected being much less than the mortgage payments required. I am now struggling to make the payments. I have tried to re-mortgage but no one will take it on as it has fallen invalue and the current lender is offering significantly less based on current rental values. If I stop payments (it is a buy to let mortgage) and allow them to re-possess what will happen ? All ideas and thoughts gratefully recieved..

A) The remedies available to the mortgagee are as follows - to attorn the rental income - to proceed with foreclosure or exercise their Power of Sale right as stated in the mortgage document - to recover any shortfall resulting from a deficiency from you. In order to speed up the process, you can offer to deliver a quit claim deed and hope that the deficiency is minimal.

Small private income, but no job. Can I get another mortgage?

Q) I am from the UK, and following some investments am in a very lucky position, as to have an income from some (4) properies I let. Can anyone recommend a a buy to let mortgage provider who doesn't need the applicant to have a job? (and offer decent rates) Thanks

A) self assessment mortgage charcoal does one or 100% one you do have income from your rental that comes in - that is a job you are a manager arent you?

is buy to let in the uk still a good investment ?

Q) everything seems so expensive at the moment, i just dont see how people get on the property ladder. but it also seems to me that this is a unique time as buy to let mortgages are more freely available than ever before. buy to let landlords are sitting on a lot of property that they are unlikely to sell for a long time as they would have a lot of tax to pay and a lot have remortgaged the properties to buy more thus giving them a negative equity when considering the tax they would pay on sale . also where else would they invest with more potential for someone else to pay for the investment ? i have heard interest rates are still quite low but forecast to increase to 6 percent by the end of the year ,still not ridiculous so what do you think is it still a good investment ? if so any ideas where i should buy ?

A) As of today there is talk of interest rates going up next month and with it mortgage repayments. I am no expert but looking at performance over the past 10 years I think the bubble is going to burst, it is the law of averages things can not keep going up and up, have to fall in the end. Also you have to bare in mind that there will be an election soon, no more Gordon Brown perhaps. It is all a little too complex at the moment but good luck anyway.

Am thinking about changing my mortgage?

Q) Can anyone recommend any good mortage deals at the minute either fixed or discounted rates with no fees. I have a tracker mortgage at the moment with the Haliax and have got 17 years to run. Have been looking on the net but most of the big lenders do not want to give much away. Some says no fees but when you read the small print that isn't true as they still want to charge you a valuation fee. I am not loking at extending the term and definately will not require extending my loan or wanting to take holiday periods. Flexible mortgages look ok in principle but they seem to cater more for borrowing more money than getting rid of the milestone. Most standard mortgages will let you pay an extra 10% off each year anyway. Thank you

A) I changed to Nationwide last year. Got a great 10 year fixed rate and the only fees I had to pay were for the arrangement which was £299. This was added to the mortgage though so nothing up front. Valuation and legal fees were all paid and it was a simple process - completed in a month. Not sure of their deals at the moment but well worth checking out.

What is the average buy to let mortgage interest rate?

Q) And what about the average amount lent?

A) It depends on quite a few things. Usually the lender looks at 3 things. 1 the loan amount compared to the appraised value of the house. 2 your debt to income ratio 3 your credit On my website there is a running ticker showing the current rates on many loan types. Its updated by the minute. However your rate will depend on the 3 factors mentioned earlier. http://www.freemortgagepro.com P.S. Im a loan officer so if you have more questions just email me at info@freemortgagepro.com

High Mortgage Rate?

Q) I am wondering if there is anyway to obtain a list of people with high mortgage rates. I had someone tell me that a title company could help me with a list like this, but my title company didn't know how to help. I work for a mortgage company that has a no closing cost refinance and I want to promote it to people with high mortgage rates. If anyone can help let me know. Thanks

A) Purchase a mailing list.

Hedging strategy against variable-rate mortgage?

Q) We all know that variable-rate home mortgage usually offers a lower rate than than the fixed-rate one (if compared at the same moment in time). Does it work for an average home buyer to do the following: borrow at a variable (lower) rate, and use a hedging strategy, such as buying a T-note futures or options (or any other market instrument of the interest-rate markets) ? Simply put, the idea is this: we use low mortgage rate, and if it goes up later, we will lose on the higher mortgage payment, but our investment in the interest-rate market will also go up, so we will gain a similar amount to offset the rise of mortgage payments. I know, large corporate land and real estate owners and maybe home builder companies do that, but does the same approach work to save money for individual home-buyer? If you have knowledge in this field, please let me know which instrument can I buy (or short) for such hedging? The interest-rate instrument (stock/futures/options) used here needs to meet 2 criteria: large leverage, small per-share price (because of the need to sell it little-by-little as I keep paying off and reducing the outstanding mortgage size). Thanks! Dear jw, thanks for your answer, it was very helpful. I'd like to reply to your idea of using a CD account or Money Market - the problem is that if I have a $300k mortgage, I will need another $300k (of cash) to put on the CD - most of the time, people do not have the money (or else they wouldn't need to borrow). That's why I mentioned *leverage* (such as exists in futures/options) - because only a small fraction of the capital is required to buy these. Would you be so kind to comment on this? Thanks

A) The theory of hedging you describe is used by the pros as a matter of course. However, what works for insitutional investors does not necessairly work for the average joe. The problem with your plan is that when your ARM goes up, the payment goes up, ie you are out more cash on a monthly basis. Your T-bill provides no such additional monthly income. You would want to put the extra cash into an investment vehicle which pay a dividend as rates rose. You could pick any dividend paying stock for example. Better still would be to put the money in a savings account which earned interest and withdrew money as needed. If your 5% ARM goes up to 8%, that 3% difference is hedged by the savings or money market account. You can do it with T-Bills, but a money market or CD is prolly easier and provides the same protection. **Reply** No, you only need enough cash to offset rate increases on a per month basis. So if you need an extra 100.00 per month, then you would set aside an appropriate amount. Ok, so here's why I suddenly got real vague...I'm lazy. The real amount you need will depend on the number of adjustment periods you face in a year. You would also have to guess at the interest rate changes (typically an ARM has a ceiling, I would use that). Now calculate the Future value and adjust for inflation. Now you know how much you need. Again, rates and adjustment periods will vary so the math will get tricky and fast (and I'm too lazy to make an excel sheet for it). At this point you might be thinking its not worth it. And you're right. Get a flat 30 month loan and forget gaming interest rates and trying to guess how much you need to squirrel away annually to hedge rate increases. My .02

adjustable rate mortgage payments?

Q) i just purchased a home with an adjustable rate mortgage and am starting to make payments and have several options...is it better to add more to the principal or escrow as opposed to just paying the interest only payment..for instance my payment is $1000.00 and i usually but not always have some extra let's say $200 extra to put on the house payment...i have the choice to put the extra on the principal or escrow? which is the best

A) it depends on what your plan is? are you going to stay in the home for a long time? is the home in an area that is appreciating quickly? the only way to pay down the balance is to pay principal, this way your home builds equity, you also build equity if your home appreciates (gains value either by improving it, or by the nature of your area'a market). what you should know is that adjustable rate mortgages should not be relied upon for the long term. if you are staying in that house for a long time you should really consider a fixed rate refi

Should I take a higher rate on my mortgage if it allows me a greater down payment?

Q) I have $50K (USD). I am looking at 5/1 ARMs for a $320K condo I plan on owning for 4 years. Since I don't have enough for 20% down payment, I need to take out a second mortgage at a 30yr rate of 7.875%. Lets compare 2 rates... 5.0% Fees of $10428.00 6.0% Fees of $2709.00 At 5.0% I could put $39,572 down and have a 2nd mortgage of $24,428. At 6.0% I could put $47,291 down and have a 2nd mortgage of only $12,709. After 4 years the balances of my two mortgages would be... 5.0% : 239,693.00 + 23,483.13 = $263176.13 6.0% : 242,213.19 + 12,217.35 = $254430.54 and money spent on monthly payments would be... 5.0% : 48 X 1,374.26 + 48 X 177.12 = $74,466.24 6.0% : 48 X 1,534.85 + 48 X 92.15 = $78,096.00 Even though I would save $3,629.76 on my monthly payments, I would have to pay $8,745.59 more to pay off the balance of my mortgages. I have read things online that say since Im paying more in the monthly payments that the 5% would be better, but what role if any does principal play?

A) There are a few tips after reviewing your analysis. - You have to pay over $7K to save $3,600 in payments. In other words, you will lose approx $3,400 to lower your monthly payments. (not worth it if you ask me) - You have not factoring the tax benefit for higher interest payment as well. - Paying off mortgage is not always the best for your goal. If you are going to sell in 4 - 5 years, the mortgage will be paid off anyways. The principal balance remaining should not be the biggest concern. - If your credit is okay, another idea is to get a 100% financing. Yes, the mortgage payment will be higher. So does your tax benefits. You can keep the $50K to invest elsewhere (i.e. your retirement account). Having the liquidity is still benefitcial to you. For example, mortgage interest will be $15,750 over 4 year period ($50k @ 7.875%). The actual interest paid if you are @ 28% tax bracket is $11,340. If you invest at a tax-free investment @ 5.5%, your will make $11,921 after 4 years. Net gain of $580. Just something for you to think about. Of course you will need to check w/ your CPA for more tax questions. Meanwhile, with zero down, the home could be appreciating @ 5% every year. Not a bad investment. - If the rates drop in a couple of years, your closing cost for 5% just a waste. Good luck.

Does Mortgage interest rate go down after Thanks Giving?

Q) My settlement is more then a month from now and I need to lock the interest rate in 10 days. One mortgage broker told me that the interest rate usually goes gown after Thanks Giving. Is it true (let say statistically in the last 10 years) or just a rummer? Thanksgiving Dates for the last 7 years: 1999 November 25 2000 November 23 2001 November 22 2002 November 28 2003 November 27 2004 November 25 2005 November 24 Interested in 30y fixed only

A) There may be something of use here.

Any idea on a mortgage rate in MI?

Q) I am thinking of purchasing my first home. I have a credit score of 638, and gross income of $62,000. I have very little for a down payment, and I am thinking of using a downpayment assistance program. Also, please let me know when I should begin my search. My current lease is up in September, and would like to move by then. Thanks for any help provided!

A) First of all FHA allows the assistance program. Ameridreams and the like. Start looking in July. Your bottom debt to income ratio should not be higher than 38% with the new home. You can also try an 80%-20% combo loans to get the full 100%. The seller can part of the closing cost and pre-paids as well. Call a mortgage professional in you area in June and get pre-qualified to buy. They will at that time tell you how much home you can afford. Do yourself a favor! don't become house poor. In other words buy less house now so you have no problems in meeting the expense of home ownership. Rates change daily. There is no way to tell you what rate you will pay at that time. Sorry! Have you ever heard of Murphy's Law? You don't want Murphy moving into your spare bedroom. Good Luck to you!

Fixed rate Mortgage ...?

Q) I entered into a mortgage contract with a friend. My friend now wants out. I can let my friend sign a "release of responsibility" and have his name removed from the mortgage. I don't want to sell my house or face foreclosure but I'm not sure I can afford my monthly mortgage payment on my income alone. Is there anything I can do to negotiate a manageable monthly payment? Any suggestions appreciated.

A) Get a roommate.

Who is the best on-line mortgage lender?

Q) We are ready to buy a house. Rates from on-line mortgage sites "seem" lower but do they have hidden fees? If you have had any experience with on-line mortgage companies please let me know your opinion.

A) I've had several loans through Ditech http://www.ditech.com and have been extremely happy with them. Highly competitive rates, reasonable costs, easy-to-read contracts and fast, efficient service. Lending Tree http://www.lendingtree.com also has a pretty good reputation but unlike Ditech they DO shop your loan among a number of banks and brokers. This can lead to quite a bit of unwanted SPAM in your in-box if you're not careful. It may possibly save you some money though I can't verify that. The offers I got through them were no better than what Ditech offered. Ditech is a direct lender and carries most of their own loans instead of selling them off on the secondary market. A loan through Lending Tree will almost certainly be sold off, possibly a number of times over the life of the loan. Also, if you have strong credit Ditech will allow you to manage your own escrow for insurance and taxes. This will reduce the cash required at closing and will stabilize your mortgage payments though they may occasionally as for proof of payment of your insurance and taxes. They did ask me at the end of the first year on my current loan but have not asked for proof since then.

Is there a website that will give me an understanding of what kind of mortgage interest rate I will get?

Q) I am on this quest to buy a home, and am trying to figure out what I should expect when it comes to applying for a mortgage. I intend to buy in a year, which gives me time to get my credit in the best shape possible as well as save for that down payment. At this point my biggest concern is making enough money to maintain homeownership. The purchasing part shouldn't be a problem for me, but I don't want to be living check to check, so I am curious how to figure out my monthly payments based on my specific scenerio. (ex., credit score, down payment, possible co-signer if it will help, ect.) Is there a website or something that will let me plug in different scenerios to get an estimate of what I would be paying? (Like they do on car dealership websites.) Oh, I am also weary of needing to type my contact info into a website, because I am not ready to have sales people calling me left and right...so preferably a website that doesn't ask for contact info.

A) when you go to realtor.com their is a caculator assumptions on each listing input various numbers depending on down payment,cost of home-but keep in mind you cant forget insurance and taxeshomeowners are caculated with the monthly payments.each countys millage rate is different -here it is .18% =18 dollars for every 1.000.00 dollars of the price of home bought a home in 2000 new-cost 79000 at that time the taxes came in at 1286.52.you can call your local county appraisel office in your area to get a ball park figure on what your taxes will be based on the price of the home ,homeowners insurance varies greatly as to were you are looking to buy, in 2000 our policy was for456 in 2005 it went to 876 and in 2006 it went to 2186.a staggering thought i know if you have enough to put down uasually 20% you will not have to pay an additional fee for pmi its for those to be at higher risk to not be able to make their payments on a timly manner