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Buy-to-let mortgages with Ocean

Ocean don’t currently offer buy-to-let mortgages. This page is for informational purposes only.

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Common questions

How does a buy-to-let mortgage work?

A buy-to-let mortgage can be a good investment. The basic idea is that you pay the mortgage and charge rent to your tenants, which should ensure a profit each month.

In most respects, a buy-to-let mortgage works in much the same way as a normal mortgage. You'll choose the type of mortgage you're looking for (e.g. tracker or fixed-rate) and pay it back over an agreed term (e.g. 30 years).

However, because you're renting the property to other people and not living in it yourself, the terms and conditions are a bit different.

You should also be aware of the risk of your home being unoccupied. If your tenants leave and you're not receiving rent payments, you'll still have to pay the mortgage - so it's worth considering what you'd do in that situation.

Can I let my house with a normal mortgage?

No. If you want to rent your property to other people, you must have a buy-to-let mortgage. If you rent out your property with a normal mortgage and your lender finds out, they could take action against you.

The only exception is if you're taking in a lodger, in which case you should be able to keep your regular mortgage - but it's still best to check with your lender.

What type of mortgage should I choose?

The two main types of mortgage are fixed-rate and tracker mortgages.

  • Payments on a fixed-rate mortgage are guaranteed to stay the same for an agreed period. It will probably be more expensive than a tracker mortgage to begin with, but you'll be protected against interest rate rises until your deal expires. After that, you can either remortgage to a new deal or start paying your lender's standard variable rate (SVR).
  • A tracker mortgage should be cheaper to begin with, but your interest rate (and therefore your monthly payments) could change from time to time. It's difficult to predict when, so you should only choose a tracker if you know you could afford an increase in your payments. On the other hand, your payments could fall, depending on market conditions.

So if you're willing to risk your payments changing, but want to pay less now, a tracker mortgage could be the best option. If you prefer knowing your payments can't change, and are happy to pay more for the security, then a fixed-rate deal is probably best.

Can I get a buy-to-let remortgage before my current deal ends?

Switching to a new deal with a lower interest rate could potentially save you money. However, if you do this before your current deal ends, you may have to pay your lender an 'early repayment charge', which could cancel out the benefit of a lower rate.

You could add the early repayment charge to your mortgage if you like, but this would increase your monthly payments - so you should check whether it's going to save you money before you go ahead.