Independent Financial Life Planners Bishop's Stortford: What you need to know to become a landlord…

Thursday, 6 June 2013

What you need to know to become a landlord…

At Enable Independent, IFA’s in Bishop’s Stortford we know that if you are trying to get into the buy-to-let industry, you will need to treat it like a business, so you must make sure that your investment adds up.

To be able to get into the buy-to-let market you will need about 25% deposit, this will ensure you are able to access a mortgage at the best rates available.

Typically most landlords choose to take out an interest only mortgage, as repayments are cheaper, and they plan to sell the house at the end of the term of the mortgage to pay off the loan. However this might not be the best option for you, and a discussion with an IFA (Independent Financial Advisor) such as Enable Independent is probably a good starting point.

Make sure that the figures add up, the mortgage lender will need to make sure you can afford the BTL mortgage, so make sure the projected rental income is high enough. Get some advice from a local estate agent, they will be able to give you advise on properties that could offer the best rental return.

On top of the mortgage arrangement fees, if you buy a property over £125,000 you will need to pay stamp duty, to see the latest stamp duty current thresholds visit the HMRC’s stamp duty page, valuations, surveys and legal work.

Once you have purchased your buy-to-let you will need to consider the cost of advertising through a lettings agent.

Make sure you have a reasonable buffer, just incase your property stays empty or you need to redecorate, the average rent void per year is 20 days according to the Association of Residential Letting Agencies.

Issued by: Enable Independent Financial Life Planners  25c North Street, Bishops Stortford, Herts CM23 2LD Telephone: 01279 755950 - Fax: 01279 657339 Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority. It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us. NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE.

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IFA Bishop's Stortford

At Enable Independent we know that our clients trust us and rely on our advice to help them to plan a better, more secure financial future. This is a responsibility that we take very seriously especially because we know that many clients have chosen us on the recommendation of friends and family. Each one of our advisers has deep expertise in their area of specialist knowledge and, as a team, we hold some of the highest qualifications available in the financial advice industry.

Our job satisfaction comes from using our skills to find workable, affordable and flexible solutions to meet our clients needs. Whether we are planning for known future funding requirements such as house purchase, school fees or income in retirement - or for the unforeseen such as job loss, long-term illness or early death, our independence from any product provider enables us to view the marketplace impartially. Our training permits us to look beyond a product's marketing hype and select on the basis of its fitness for purpose.