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  • Debt & Negative Equity

    BTL mortgage rates rising.

    The average cost of a buy to let mortgage is on the increase, according to new research by moneyfacts.co.uk.

    Since the beginning of October, the average two year fixed rate has increased by 0.05% and is expected to continue rising. Currently, the average two year buy to let fixed rate is 2.84%, up from 2.79% at the start of October.

    The average five year fixed rate, meanwhile, is 3.44%, having increased from 3.43% at the beginning of the month.

    The news comes as Moneyfacts also report the number of BTL mortgages available has declined as lenders take stock of recent changes to lending rules.

    Charlotte Nelson, finance expert at Moneyfacts, suggests that the situation in the buy to let mortgage market will not improve in the near future.

    She said; “It has been a turbulent time for the buy to let market, thanks to multiple rule changes, and there’s no sign of calmer waters, as rates are starting to creep up from their record lows. While a 0.05% increase appears insignificant, it marks a turnaround in the buy-to-let sector, so landlords are now faced with not only more hoops to jump through, but higher rates as well.

    “With all the changes and now the rising buy to let rates, it is going to be more difficult for individual landlords to make a profit that is worth their efforts. Landlords will have to weigh up the costs to figure out what their best possible option may now be. Anyone who is unsure should seek the advice of a financial adviser.”

    Struggling with mortgage debt? We can help.

    Many landlords have found their finances coming under increasing strain recently as a series of changes to the buy to let market come into effect. The introduction of Section 24, which phases out mortgage interest tax relief, the increase in Stamp Duty on second homes, the cap on tenants’ deposits and stricter lending rules for banks have all impacted the performance of landlords’ investments.

    At Landlord Debt Advisory we offer bespoke solutions for landlords struggling with unaffordable property debt, whether it’s rental properties in negative equity, mounting arrears or an interest only term ending with no way to repay the capital.

    One of our recent clients, Gary, said; “I had been sold two pig in a poke properties for part of my retirement fund that left me having to keep pumping money to maintain them for suitable tenants. I had been stressed out for the last 10 years trying to keep on top of this investment. Last April I was left with no way to resolve this bad investment as more money was now required to replace the boiler and sort out the damp.

    “Coming close to my retirement date I had to walk away. After being recommend to Landlord Debt Advisory and discussing my situation with them, my life has now change 100% for the better. They saved me 64% of my total debt to the lender including the mortgage arrears and legal fees. I had no dealings with my lender, selling both properties and all the legal expenses, as this had been dealt successfully by the team. I would highly recommend anybody out there who need advice regarding debts to talk to Landlord Debt Advisory, as my regret is not doing it sooner.”

    Contact us now on 0161 222 4311 or go to our website to arrange an initial free, no obligation consultation.

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    None of the usual LL  haters will accept that being a LL  is not a foregone pathway to riches

    It is a risky business which is why LL  need the flexibility  to recover their assets anytime they wish.

    The new Scottish  PRT is a shot across the bows for English LL

    Operating with such a new tenancy type will render many LL  investments unviable.

    English LL  should take a good look at the new Scottish PRT and determine if something similar was introduced  to England could they cope with it.

    Unfortunately  England tends to see Scotland as a bit of a test bed for policies; witness the soon to be banned LA fees which as a policy originated in Scotland.

    The PRT  is particularly  onerous  for those LL  who have HB  tenants.

    The continuing onslaught on LL  of all the recent and soon to be changes is becoming unsustainable  and many LL  will have to face cutting their losses and forget their dreams of remaining  a LL

    Afraid return to being a wage slave and retiring on some crummy pension or just penury on a State pension; if it even exists when it is needed is what awaits many LL.

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