What will it cost me?

Deposit?
The amount of deposit required to purchase a property depends of course on the individual lenders requirement and the rentable value of the property. 
Typically a deposit of 15% of the property value is required but there are schemes available as low as 10%, with the market leader hinting towards schemes as low as 5% mid 2007.
On many buy to let schemes the loan amount is calculated as a percentage of the rental income. If you have a property in mind and want us to calculate the maximum loan amount or deposit required ask us.

Mortgage set up costs?
When arranging a mortgage there are a variety of set up costs involved. Expect to pay the following:
Valuation fee 
Payable at the start and typically £400.
Arrangement Fee
For many of the market leading rates you could pay up to 1.5% of the loan. It is worth while looking at slightly higher interest rates with lower arrangement fee's which sometimes work out cheaper long term.
Broker Fee
Expect to pay 0.5% of the loan although a fixed fee could be negotiated.

Mortgage monthly payments?
Most buy to let mortgages are taken on an interest only basis, which means you will eventually need to sell the property to pay the mortgage off.
The best way to calculate what you monthly payments could be is to use the mortgage calculator in conjuction with our Hot Rates which will give you an idea of the latest buy to let mortgage rates and the cost per month.

Finding a tenant?
This is the most important part of your investment and could make the difference between a very profitable venture and the worst move that you ever made.
Proffesional letting agents can seem expensive but unless you are able to check into any perspective tenants status and financial background they are worth every penny. Typically expect to pay a finders fee of around £500 to secure a tenant and the a percentage of the monthly rent for collection and regular inspections, around 8%. Many offer rental guarantee schemes to protect against damage to property and rental blanks. Expect to pay an extra 3-4% per month for this insurance.
An alternative to a professional letting agent would be to advertise for a tenant yourself in the local property pages. Expect to pay around £35.00 for a small advert for the week. Consider the time aspect of showing tenants around your property, the no shows and the general time wasters. 

Property refurbishment?
Allow £1,000 to make cosmestic improvements to the property, where possible look for somewhere that doesnt need alot of work, time is money. There is plenty of property to choose from and it may be worth spending a couple of thousand more on a property that is polished rather than spending your weekends and free time trying to get it finished and rented.
Remember you are not going to live there so keep it simple and plain so it has the widest appeal to waiting tenants.

Other Property related costs?
One or two bedroom Leasehold flats traditionally provide very good returns but do have the drawback of additional costs such as ground rent and service charges. These fee's are paid to the Freeholder or management company monthly or sometimes yearly in advance. Services charges could be in excess of £1000 per year so its vital to build this into your rental calculations.
Typical service charges £650 per annum.
Typical ground rent £150 per annum.

Typical Costing
Mortgage set Up
Legal costs
Stamp Duty
Finding a tenant
Management costs
Deposit 15%