Case Studies - Buy-to-Let Mortgages
A buy-to-let mortgage specifically designed with first-time buyers in mind, taking into account the challenges they may face in investing in residential property.
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Focusing on the whole picture for foreign investors in the UK buy-to-let market
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Internal teamwork for a complicated deal with multiple properties
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Returning offshore borrower looking to overcome tight BTL deadlines, with speed and security
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The tools at our disposal to help with LTV limits and tricky business plans
Read case studyFirst-Time Buyer Buy-to-Let Mortgage
- Loan amounts from £150k to £750k – more can be considered for those in a strong financial position
- LTV: 75%
- Required income of only £30k
- Can be considered for complex properties, including HMO, MUFB or holiday lets
- First-time buyers considered who do not own their main residence
- Interest rates: variable rates available
- Offshore borrowers and foreign nationals welcome
- Charge type: 1st charge
- Term: 5 years, no early redemption charge after year 2
- Completion time: from 10 days
- Location of property: England, Wales
5 simple steps to your Buy-to-Let mortgage for first-time buyers
Step 1: Loan Enquiry & Indicative Terms
You will need to send an initial enquiry through. We can be reached over the phone, online, or via email and we respond to all enquiries within 4 hours. You can also reach us through an intermediary such as a mortgage broker. One of our underwriters will be in touch to gather initial details on your situation, provide an indicative tier, and go over your loan size.
Step 2: Underwrite & Issue DIP
As we move through the process, we will attain some key documentation from you as we finalise the underwrite. Then, we will issue a Decision in Principle (DIP) which will be the credit approved term. This will all be verified by our Credit Committee, and DIPs are usually issued within 24 hours.
Step 3: Valuation
Once the initial valuation and admin fees are paid, and the DIP is signed, we can get the property valued. Your assigned underwriter will organise this, fitting your situation in with our panel of trusted valuers. The valuation itself should be organised withing 24 hours of fees clearing.
Step 4: Legal Documentation
Following the valuation, the solicitors will get involved to complete their due diligence. We only work with solicitors we trust to ensure your investment is handled at pace. Throughout this process, you will be updated along every step of the way.
Step 5: Loan Drawn Down
When everything is ready, you will be provided with your first-time buyer buy to let mortgage. You can then use the capital to invest in your targeted residential asset. In some instances, this funding can be delivered within a week of initial enquiries.
First-Time Buyer Buy-To-Let Mortgage –
All you need to know:
Are there any first-time landlords you won’t work with?Do you have any age limits in place?Do you place limits on property types?Can I live in my buy-to-let property?How is my affordability calculated?Will the rates differ for first-time buyers?How much deposit do I need?Mortgage repayment optionsWhat documents will I need to apply?Do I need a mortgage advisor?Are there other products available for first-time buyers?Why MFS?
Are there any first-time landlords you won’t work with?
No, our buy-to-let mortgages for first-time buyers are available to individual investors, via corporate structures such as an SPV, offshore borrowers, or those who do not own any property. We do not follow a tick box lending criteria, every one of the applications we receive is assessed on its individual merit. So long as your details fit in with our parameters, we should be able to support your buy-to-let strategy.
Do you have any age limits in place?
First-timer buyers may be relatively young compared to more experienced property investors. However, we do not limit our first-time buy-to-let mortgages to older landlords. Our buy-to-let mortgages for first-time buyers are available for those aged between 21 and 75+.
Do you place limits on the types of properties first-time buyers can invest in?
No, our buy-to-let mortgages for first-time buyers can be used for a broad range of property types. This includes relatively straight forward investments, such as student accommodation or houses, through to complex assets such as MUFBs to 30 units or short-term lets. However, we do require the use of a specialist letting agent.
Can I live in my buy-to-let property?
No, our first time buy-to-let mortgage can only be used for investment purposes. Meaning your tenants, not you or your close family members, will be living in the property you’re investing in.
How is my affordability calculated?
When purchasing a buy-to-let property with us, several different elements will be factored into the affordability calculations. At MFS, we like to look at a case in its entirety. This includes not only the rental income, but also the overall A&L, your accessible wealth, any surplus income and more. We do this to ensure agency fees, voids, maintenance, tax, ground rent and other associated costs can be comfortably covered.
Will the rates differ between first-time buyer buy-to-let mortgages and other mortgages?
Across our BTL mortgages, there are 4 applicable tiers. Tier 1 loans are for the most straightforward cases, whereas tier 4 mortgages are for particularly complex deals. To reflect the risk associated with lending to first-time buyers, we automatically place these new entrants to the market into our tier 3 loans at a minimum. Tier 3 mortgages are reserved for complex borrowers or properties, including: large structures, expats, foreign nationals, overseas companies and more.
How much deposit do I need?
For our first-time buyer buy-to-let mortgages, we lend up to 75% loan-to-value. Meaning the minimum deposit required will be 25%. Generally, those with larger deposits may face lower repayment costs.
What mortgage repayment options do you have available?
We have several repayment options available for our buy-to-let mortgages for first-time buyers, including interest only repayments via a monthly direct debit from a UK account. Additionally, you may be able to roll-up between 1 to 9 months of payments.
We can support your affordability concerns through our repayment flexibility. You could defer up to 2% interest until redemption to boost your residential mortgage size where needed. We also have top slicing options available, which can factor in earnings outside of your rental income. Our underwriters have flexibility and multiple tools at their disposal to boost the loan size for your rental property.
What documents will I need to apply?
As every application we receive is assessed on its own merits, the paperwork needed will vary from person to person. The documents we request from you will likely depend on where you are on the property ladder, the asset itself, and several other factors. Your underwriter will be there from day 1 to explain what documents we require. At the front end, we will need to verify a form of ID, and will need the details of the property you wish to use our BTL mortgage for, so having those documents to hand will be beneficial.
Do I need a mortgage advisor?
While we can work directly with borrowers and brokers, it will be up to you to determine if you need the support of a mortgage advisor, or any other financial expert. Mortgage advisors, as well as brokers, can help you better understand your options, and potentially find better deals.
But, they will levy charges for their services. If you determine these costs don’t fit in with your budget, you may be able to utilise external tools yourself to aid your decision making. This could include a stamp duty calculator, free online guidance, or other tools. It will be up to you to decide whether or not to utilise a mortgage broker.
Are buy-to-let mortgages the only products you have available for first-time buyers?
No, our bridging products can also be used by first-time buyers. This includes among others our residential bridging loans, auction bridging loans, and permitted and light development finance.
Why MFS?
Our buy-let-mortgages are available to first-time buyers as well as seasoned portfolio investors. Buy-to-let mortgages for first-time buyers may be hard to come by on the high street due to perceived risk or being seen as complicated investments. But, we’re happy to work with new entrants to the landlord market, as well as experienced investors. So long as your property investment plan is sound, and you have a solid exit strategy at the ready, we should be able to support you in becoming a landlord in England or Wales.
