Let-to-Buy
Let-To-Buy | The Advantanges For Investors Revealed
Let-to-buy offers some advantages for people who want to move to a new property but are unable to sell their existing home. Let-to-buy dates from the economic recession of the early 1990s. While many people lost their homes to repossession, those who were able to hang on to their homes found that the property market had died and they were unable to sell them. This meant that people who needed more living space for larger families or less living space for smaller families were stuck with a property they couldn't shift. Letting to buy provided the solution.
Let-to-buy means that people let out their existing home and borrow money to buy a new one. There are several reasons why this might be an advantage. For example, the changing pattern of working might provide a reason to use let-to-buy. Suppose you change jobs and need to move, but are not sure whether the job will work out. Instead of selling your old home and saying goodbye to it for ever, you can let it out and borrow the money to buy a home in your new location.
If the job doesn't work out, or you move to somewhere else, you can always return to your old home. And with let-to-buy, you always have the option of selling the house if you change your mind. Meanwhile, letting to buy offers you the chance to realise your investment in your property and have the mortgage paid by tenants. And if you have a low monthly mortgage payment, you may even make some money from the let-to-buy deal.
Another good reason to use let-to-buy is if you are in a property chain. These can get long and the sales process can last so long that someone in the chain can lose a property and have to start again, further delaying the process. Letting to buy means that you remove the need to sell your property urgently and can move on to the new property you wish to buy.
Let-to-Buy Rules
If you want to do a let-to-buy, it is essential to tell both your mortgage provider and your household insurer as let-to-buy will have an impact on the terms of your mortgage and insurance policies. 
The good news is that you can usually borrow more with this type of investment, while buy to let loan to value is around 80 per cent. You are also likely to get a let-to-buy mortgage at a residential interest rate, which may be lower than many BTL mortgage rates.
Let-to-buy can be a back door route into property investment on a larger scale, as once people have begun to invest in rented property they may find it easier to do a second and third time. The key issue with let-to-buy is to make sure that your property is suitable for letting and will bring in a rental income that will cover your mortgage. Once you've done your research, you'll be ready to take your first steps into let-to-buy.
