Buy to Let Remortgages Can Help Build a Landlord Portfolio
There are times when a landlord decides that the best business decision is to add to their portfolio. Adding more properties into the portfolio for buy to let purposes takes capital and it takes a consideration as to what cash is available to make a deposit for a new purchase mortgage. Many landlords often overlook the obvious consideration of a buy to let remortgage.
Buy to let remortgages can not only be used for the purpose of adding additional properties to a portfolio, but also for other business needs such as renovation costs, repairs, or expensive maintenance. It is though a very good source of money for a landlord to be able to offer a deposit on another property. There are many buy to let remortgage products on the market and most landlords whether largely invested in the buy to let market or a small or new investor will find the right buy to let remortgage product for their needs.
A landlord uses built up equity in their buy to let property or properties to gain a cash release equity remortgage. The cash released from the remortgage is then used for a deposit on another new purchase. Sometimes depending on the market it can be spread across more than one new purchase and fund the purchase of many properties. There are buy to let remortgage experts that can assist a landlord in how to proceed and if indeed a remortgage is the best financial consideration. While it is a source of funding for adding to a portfolio it should also be understood that any remortgage for equity release adds debt to a property. Adding debt can put the business at risk and the added debt is very much a financial consideration for a landlord. It isn’t the right financial decision for every landlord but it is a common transaction and common purpose in the buy to let investment field.
A buy to let remortgage can also give a landlord a cut on costs should there be lower interest rates to be gained against the current mortgage interest rate. This too in some cases could make it possible to obtain another or more properties to add to a portfolio as the landlord will save on interest expenses on other mortgages. Another purpose of a remortgage that can be added in as beneficial for a landlord besides funding a portfolio addition is changing the type of buy to let loan. A landlord may want to secure the payments from a tracker to a fixed rate loan, especially when interest rates are low. A fixed rate buy to let remortgage can offer up a landlord the ability to better budget expenses by giving them a set and expected monthly repayment amount over a specific time period.
With lenders continuously adding in more attractive buy to let remortgage products designed to match and meet the unique needs of a landlord, the consideration of a buy to let remortgage could be the source of capital to help further the business goals of an investor.