Which? Mortgage Advisers is making its mark on the small screen – Rupert Swetman, head of lending for Which? Mortgage Advisers, recently appeared on the Buy to Let Show, a new programme created by property expert Kate Faulkner.
Kate, who previously authored the Which? book Renting and Letting, created the Buy to Let Show to educate new and existing landlords about everything involved in owning a buy-to-let property.
Kate interviewed Rupert about why it’s so important to use an experienced mortgage broker to finance buy-to-let property investment. At the end of the show, Rupert was also one of three panel experts answering questions about financing and insuring buy-to-let investments.
In the interview and during the panel session, Rupert explained the major differences between lending on an investment, as opposed to a home you live in. For one, lenders perceive buy to let as a higher risk and, as a result, require bigger deposits; typically a minimum of 25%.
Since the credit crunch, investor deals are now ‘stress tested’ much more rigorously than before. Lenders will look to make sure that rent levels exceed mortgage payments not only now, but should interest rates rise in the future.
Lenders will also check that the rent will cover other lettings costs, such as legal checks and processes. Even if your rental return is strong, in some cases you’ll require income from other sources, such as a job, to help you survive if the property is empty or the tenant stops paying rent.
Check out this episode of the Buy to Let show to hear Rupert explain the ins and outs of buy-to-let mortgages.