Deposits

Some Deposit Related Issues  

The Deposit is usually a crucial factor in decisions related to buy to let mortgages so some information relating to deposits is included below.

Using a smaller deposit may allow you to buy more properties.

If the amount of deposit you have available is restricted there are a number of mortgages that allow you to buy with a low deposit.

The minimum deposit you will need for a buy to let mortgage is usually around 10 or 11%.

The standard minimum deposit is around 15% then a much larger group of mortgage lenders become available and the interest rates can be lower.

If you borrow more then you could reduce your income tax liability. The higher your mortgage interest payments the larger the expenses that could be offset against tax.

Vendor Gifted Deposit. Rather than paying the deposit yourself you may be able use a vendor gifted deposit instead. This could be offered by a house builder as part of a promotion or as a discount from the vendor. Not all buy to let lenders will accept vendor gifted deposits.

Deposits for a buy to let property could be raised from savings or investments. You can also raise the money from the equity in another property your home or an existing buy to let property. You may be able to obtain a futher advance on these properties or remortgage with another lender.