What we cover in this guide
- Can I remortgage a Buy-to-Let property?
- Read our Buy to Let guide
- Try our Buy to Let mortgage calculator
- What are the criteria to remortgage my Buy-to-Let property?
- Should I remortgage my Buy-to-Let property?
- When shouldn’t I remortgage my Buy-to-Let property?
- What are the fees to remortgage my Buy-to-Let property?
- Buy-to-Let remortgage rates
- Can I remortgage my Buy-to-Let property and increase my borrowing?
- Buy-to-Let remortgage lenders
- Specialist Buy-to-Let remortgage advisers
Can I remortgage a Buy-to-Let property?
Yes, it’s possible to remortgage your Buy-to-Let mortgage to a new deal.
The reason for doing so is clear – to find a better deal than the one offered by your current lender. So, you’ll avoid an increase in costs and potentially make savings on your outgoings – therefore, maximizing your profits. However, it’s important to take more than just the interest rate into account when considering your options. Some other things to consider are:
- Your current lender is likely to charge a standard exit fee. If you are still within a tie-in period on your current scheme, you will also face early repayment charges. You’ll need to check your mortgage agreement or annual statement for all the details of any early payment fees.
- Taking out a new mortgage could also come with further costs. This could be valuation fees, arrangement fees and legal costs. You’ll need to check that the extra costs incurred, don’t exceed the amount you expect to save in interest payments on a new deal.
- Lastly, common sense will tell you to make sure the terms of the new mortgage suit the plans and needs for your investment. Will you be tied into early repayment charges, or will you be free to move the mortgage after a certain period? Be aware of attractive offers designed to tempt you into a particular scheme e.g. tracker mortgages.
Should I remortgage my Buy-to-Let property?
For your Buy-to-Let property business to thrive, you will need to make sure your margin of profit from the rental income is as high as possible. Ensuring that your Buy-to-Let remortgage deal is on the most favourable interest rate available will ensure costs are kept down.
Some landlords may have seen their property increase significantly in value. Therefore, they will want to take advantage of this extra equity by releasing funds in a remortgage.
They could use it on renovations or to buy an additional property. Others may want to remortgage to change some of the terms of their loan. For example, switching from a fixed-rate mortgage to a variable rate product.
When shouldn't I remortgage my Buy-to-Let property?
It’s important to make sure that any changes to your financial arrangements will be to your benefit in some way. It’s also important that you’re aware of situations in which you shouldn’t remortgage your property.
- If you are tied into a mortgage, then you may need to pay fees to release yourself from that plan. This could work out to cost you more than staying with your current arrangement and interest rate.
- A new mortgage is likely to entail many set-up costs – for example, arrangement fees, legal costs, and survey fees. This is particularly worth thinking about if you only have a small balance remaining on your loan.
What are the fees to remortgage my Buy-to-Let property?
There are a number of fees involved when remortgaging your Buy-to-Let property:
- Lender’s arrangement fees – You are likely to get the most competitive rates from a lender if you can pay an arrangement fee. This can range from being a fixed amount to a percentage of the loan value. Many lenders will allow the fee to be added to the loan amount, so you will not need to pay it upfront. However, you should note it will remain there for the life of the mortgage, meaning you will pay interest on it.
- Application or product fees – These are similar to arrangement fees but are simply payments to access a particular service. As such, they are likely to be always charged upfront, and will be non-refundable in cases where your mortgage is not complete.
- Valuation or survey fee – A big part of a lender’s assessment is a survey to ascertain the property’s value. A lender will want to determine the property’s condition, type, and value to be sure of the amount they should let you borrow. There are many lenders who offer this service free of charge as part of the arrangement, but many others will charge you.
- Legal fees – Again, some lenders will have their own legal representative to act on their behalf. However, others will ask you to cover this cost.
- Mortgage broker fees – You should always make sure you get the best advice from a qualified, experienced broker. This will help ensure you get the most suitable and favourable deal. Mortgage brokers are essential to this end and will usually charge a broker fee for their services.
Can I remortgage my Buy-to-Let property and increase my borrowing?
If your property has gained in value since the time you first took out your mortgage, then yes, it is entirely possible. Usually, however, there are various criteria that a lender will need to consider during the application process.
Unfortunately, estimates of the size of a loan that the lender is willing to extend may go down as well as up. This all depends on your individual circumstances. If you want to increase your borrowing, then you should get in touch with our team today. One of our expert advisors will be able to guide you through the process.
Buy-to-Let remortgage lenders
Many high street banks and building societies offer Buy-to-Let mortgages and remortgage products. However, they are unlikely to be at the most competitive rates.
You’ll find that the best rates are offered by specialist lenders who you won’t find on the high street or online. These lenders and deals are accessed via a specialist mortgage broker with expert knowledge of the mortgages landscape.
If you’d like to access exclusive deals, get in touch with us and we will pair you with one of our expert advisers.