Category Archives: Mortage

Re-mortgaging, whether for your home or a buy-to-let property, involves moving your mortgage from one lender to another to secure better terms. Here are the key points to consider:

1. Why Re-Mortgage?

• Better Rates: Secure lower interest rates and reduce monthly payments.
• Debt Consolidation: Combine other debts like loans or credit cards into your mortgage.
• Capital Raising: Borrow additional funds for purposes like home improvements or property investments.

2. Timing Your Re-Mortgage

• Start looking at least three months before your fixed deal ends.
• Most offers are valid for six months, giving you time to switch without reverting to your lender’s higher Standard Variable Rate (SVR).

3. Costs and Legalities

• Consider fees like arrangement charges, valuation costs, and legal expenses.
• Many lenders offer free legal services as part of their re-mortgage packages.

4. Choosing the Right Lender

• Factors like loan affordability, credit commitments, and lending criteria play a role.
• Mortgage advisers can access the entire market, ensuring tailored options that meet your needs.

5. Credit Checks

• Lenders may conduct hard or soft credit checks.
• Advisers help minimize unnecessary hard checks to protect your credit score.

6. The Role of Mortgage Advisers

• They simplify the process, find competitive deals, and save you time.
• Advisers assess affordability, portability, fees, and early settlement charges—factors often missed by online comparison sites.

7. Considerations for Debt and Capital Raising

• Debt Consolidation: While it can reduce monthly payments, ensure long-term interest costs are manageable.
• Capital Raising: Use funds for home improvements, education, or property investments, keeping loan-to-value limits in mind.

By starting the process early and consulting a whole-of-market mortgage adviser, you can secure the most suitable re-mortgage deal for your circumstances. For personalized advice, contact us at 0141-424-0267

Tax-Efficient Buy-to-Let Mortgages

Managing buy-to-let mortgages efficiently requires careful consideration of tax implications and financing strategies. Here’s a simplified overview of key factors to keep your investment tax-efficient:

How Buy-to-Let Mortgages Are Assessed

Buy-to-let mortgages differ from standard residential mortgages, with lenders applying specific criteria. Whether you choose personal ownership or a limited company structure, the tax treatment varies significantly.

Tax on Rental Income

Rental income is subject to income tax. However, understanding deductible expenses—such as repairs, property management fees, and some capital improvements—can reduce taxable income. Be aware that mortgage interest is no longer fully deductible, especially for higher-rate taxpayers, but limited companies may offset this expense more effectively.

Capital Gains Tax (CGT) Planning

When selling a buy-to-let property, CGT applies to any profit. Leveraging allowances and strategic planning with an accountant can help minimize this liability. Frequent buyers and sellers might benefit from holding properties through a limited company to streamline CGT and other tax concerns.

High-Rate Taxpayers and Mortgage Relief

Recent changes in tax rules have limited mortgage interest tax relief, especially for high-rate taxpayers. Switching to a limited company structure can offer benefits like offsetting mortgage interest against corporation tax, which is typically lower than higher-rate income tax.

Limited Company Ownership

The popularity of limited company buy-to-let purchases is growing. This structure often provides better tax efficiency, particularly for portfolio landlords or high-rate taxpayers. Discussing your plans with a mortgage adviser can help you determine the best ownership model for your needs.

Allowable Expenses

Claiming allowable expenses can significantly reduce your tax bill. These may include:

• Utilities and council tax
• Landlord insurance
• Maintenance and repair costs
• Legal and professional fees
• Advertising for tenants
• Ground rents and service charges

Consult an accountant to ensure you accurately claim all allowable expenses.

Specialist Advice

A tax-efficient mortgage adviser can guide you through structuring your portfolio, evaluating costs, and maximizing returns while staying compliant with tax laws.

Final Note

Always consult a qualified accountant or tax adviser before making financial decisions related to buy-to-let investments. Their expertise ensures your portfolio is both profitable and tax-compliant