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Future proof your buy-to-let investment

Landlords can often be attracted to a deal that suits your immediate needs, without understanding the longer term implications.

For example, the way the lender calculates affordability on a five year fixed rate may be an attractive way for you to maximise your borrowing on a purchase, but what will the options look like at the end of the 5 years?

Does the lender have a rate switch option? If not, there is a risk that you or the property may not qualify for a remortgage, leaving you paying a higher SVR rate at the end of the 5 year term.

Other areas that should be explored are things like the lenders maximum mortgage term.

A bridge loan for example will often be for a maximum of 12 months. Some bridge lenders have launched BTL products that have just 3-5 year maximum mortgage terms and many commercial lenders have maximum commitment terms of just 5 years.

This means, even if you have taken a 20 year repayment mortgage, the lender is only committing to make the funds available for a maximum of 5 years, so what are your options likely to be at this end point?

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