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BUY
TO LET

A buy-to-let mortgage is a mortgage sold specifically to people who buy property as an investment, rather than as a place to live.

We work from the whole of the market, tailored to best suit your personal and financial circumstances.

We will then advise you on the pro’s and the con’s for each mortgage.

This way, when you're ready to make a decision, you can do so knowing you've got all the facts.

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Most Buy-to-Let mortgages are not regulated by the Financial Conduct Authority

  • Best Mortgage Since 2002.

  • About
    Donakd Zain

    CEO At Pento

15

YEARS OF EXPERIENCE

1000s

MORTGAGES ARRANGED

£1,000,000s

FUNDS
SECURED

For limited companies, lenders will assess a director’s income based on the salary they take from the business. Salaries will be considered along with dividends or a share of net profit.

Directors are often advised by their accountants to take a base salary up to the tax-free threshold and then to draw dividends for any further income. As a result, a lot of profit can be retained in the business.

This is because directors may want to use capital to further expand, not to mention paying less tax! The drawback to this is that lenders will only consider the income that is actually withdrawn from the business.

For more information about Director mortgages please Contact Us

Your home may be repossessed if you do not keep up repayments on your mortgage

When a contractor’s pay is based on an hourly, daily or weekly rate – with contract from different sources varying, you are probably not able to give a figure for an annual salary, or provide the two or three years’ worth of accounts that typical mortgage providers like to see when assessing your application for a mortgage.

To address this, specialist mortgages for contractors have been set up so that you can borrow money based purely on your contract rate. When making their affordability assessment during the application process, those lenders that are used to dealing with contractors will give far more weight to your current status and ongoing agreements than your past history.

For more information about Director mortgages please Contact Us

Your home may be repossessed if you do not keep up repayments on your mortgage

When applying for a mortgage, a sole trader must have at least 12 months of trading history. If you have more trading history, then your assessment is usually based on the last three years. Lenders assess trading history to calculate your affordability. This is based on the income you’ve declared.

If you’re a contractor registered as a sole trader, you may be able to get a mortgage with less than 12 months of trading history. Some lenders allow contractors to use day rates to calculate affordability.

In addition to this, lenders calculate affordability on gross income as opposed to net income. This is advantageous, as it allows applicants to maximise their loan amount.

For more information about Director mortgages please Contact Us

Your home may be repossessed if you do not keep up repayments on your mortgage

Mortgages tailored specifically for those working in professional fields typically have reduced rates and fees in comparison to regular mortgages. Professional Mortgages can often be approved faster due to the profession you’re in.

Statistically, professional borrowers are seen as low risk by lenders. From understanding your career choice, lenders can make certain assumptions on whether a mortgage is viable. As a result, you may be offered certain flexibility on deals, simply because of your employment.

For more information about Director mortgages please Contact Us

Your home may be repossessed if you do not keep up repayments on your mortgage

If you own more than 20% of a business from which you earn your main income, then most lenders will view you as self-employed. Furthermore, your business structure will be taken into consideration by lenders.

The majority of lenders will assess the affordability of a mortgage based on your net income or net profit. The way lenders calculate this figure varies. Some lenders will base the affordability on your most recently declared income. Other lenders will calculate your affordability on an average of the past two or three years’ accounts.

For more information about Director mortgages please Contact Us

Your home may be repossessed if you do not keep up repayments on your mortgage

Typically, you will need to have a minimum income of £25,000, and typically your rental income to be 125-145% of the mortgage, but this varies from lender to lender.

Some Buy to Let lenders will solely assess the affordability of the mortgage. Lenders calculate this by ensuring the annual rental income is at least 125% of the annual mortgage interest payments. This means for every £1,000 you’re paying in mortgage interest each year, you would need at least £1,250 a year in rental income. This is usually quite realistic, as the rental income often covers the interest payments by more than 125%.

For more information about Director mortgages please Contact Us

Most Buy-to-Let mortgages are not regulated by the Financial Conduct Authority.

  • Variable-rate mortgages

    A variable rate mortgage is a product in which the interest rate can shift at any time, either to a higher or lower amount. Unlike a fixed-rate mortgage, there is no period where the rate is locked in, and how much you pay each month is subject to change. This type of mortgage is affected by the Bank of England’s base interest rate, as well as other factors.

  • Fixed-rate mortgages

    With a fixed-rate mortgage, the interest rate is fixed for a set amount of time and won’t be affected by Bank of England base rate rises or fluctuations. Once you’ve taken out a fixed-rate mortgage, you will be locked into the introductory rate for a set period of time, and if you leave you’ll be subject to exit fees.

  • Capped-rate mortgages

    A capped-rate mortgage is a type of variable rate mortgage that will not rise above a certain rate, also known as a cap. These deals are most commonly available as variable rate or tracker mortgages.

  • Discount mortgages

    A discount mortgage sees you paying a reduced version of your lender’s standard variable rate. The amount of discount is fixed, and the reduction is applied whether the variable rate is increased or decreased by the lender.

  • Offset mortgages

    An offset mortgage allows you to link your mortgage and your savings together to reduce the amount of interest you are charged. It works by offsetting the value of your savings account against how much you borrowed for your mortgage loan, so that you are only charged interest on the amount left over.

FAQ