What Is Buy-to-Let Conveyancing?
Buying to let is an increasingly popular way of investing in the UK - although buy-to-let mortgages come with their own set of rules and challenges that differ from when getting a mortgage for a residential property that you intend on living in yourself.
Investing in buy-to-let property offers a reasonably low risk, giving you the opportunity of a consistent return for the long term.
Getting the right conveyancing solicitor can be extremely useful in order for the process to go as smoothly as possible. Read on to find out more all about buy-to-let conveyancing.
What Is Buy-to-Let Conveyancing?
Buy-to-let conveyancing is the legal transfer of ownership of a property that is intended to be rented out to tenants and not to be lived in by yourself. Buy-to-let properties are often used as long-term investments so buyers can profit from this financial decision and purchase later on down the line.
The conveyancing process often begins when an offer on a property is made and accepted - and carries on through the entire process, only finishing on the day you receive the keys to the property.
Conveyancing for Buy-to-Let Mortgages
During the buy-to-let conveyancing process, your conveyancing solicitor will receive a copy of your mortgage from your mortgage provider.
You surveys will have been carried out by your Lender at this time and necessary searches carried out by your Solicitors. Before exchange of contracts, your mortgage lender will also require you to arrange building insurance. This ensures you are protecting yourself and the lender.
Can You Live in Your Buy-to-Let Property
In short, no - you cannot reside in your property if you have a buy-to-let mortgage on it. It will breach your buy-to-let mortgage conditions with your mortgage lender.
You get a buy-to-let mortgage for tenants to live in the property and pay rent to you, therefore you cannot live in it yourself. If you want to live in your buy-to-let property, then you will need to switch over to a standard residential mortgage.
This is something you will need to have a conversation with your mortgage lender. Not all lenders will agree to this switch so you may need to shop around. You also won’t be able to switch your mortgage over straight away if you recently took out your buy-to-let mortgage.
Most lenders will only allow you to re-mortgage to a new deal six months after you sign a mortgage deal. This is the standard process of any mortgage, so think carefully before you decide you want to agree to a buy-to-let mortgage deal.
What Happens If I am Caught Living in My Buy-to-Let Property?
If you are caught living in your buy-to-let mortgage property, you can end up on the Rogue Landlord Database. This is a database that was bought together in 2018 and helps the authorities identify landlords that have broken rules in the past and committed illegal acts. This helps to protect tenants too.
Buy-to-let mortgages are provided by mortgage lenders on the basis that the monthly rent from your tenants will cover the mortgage payments. This means that if you live in the property and not the tenants, your mortgage lender won’t have a guarantee of where the mortgage payments will be coming from.
The Buy-to-Let Conveyancing Process
If you are interested in the buy-to-let conveyancing process, then read our steps below to understand the process of the important legal stages more clearly.
Step One
Once your offer on a property has been accepted your conveyancing solicitors’ job will begin. They will contact the seller’s conveyancing solicitor to obtain the contract pack.
Step Two
The contracts will be checked over and necessary enquiries will be made, and searches will be carried out.
Step Three
The conveyancing solicitor should make sure there are no restrictions on renting out the property. and that the property If you have any future development plans for the property, then now is a good time to ask about them.
Step Four
Your conveyancing Solicitor will send you a completion statement to request funds to exchange Contracts and conduct pre completion searches. A completion date is agreed upon like it would for a residential property mortgage - and both buyer and seller’s solicitors exchange contracts. This now means you will be legally committed to the purchase.
Step Five
On completion day, your conveyancer will send money to the seller's solicitors. . Your conveyancer will submit a SDLT return and pay any stamp duty to HMRC. You may have to pay additional stamp duty charges with a buy-to-let property.
Step Six
Your Conveyancing Solicitorwill then have your property registered in your name at HM Land Registry.
Buy-to-Let Mortgage Fees
Buy-to-let conveyancing costs will depend on a few things. The location of the property will affect the fees. The fees will also vary from a residential mortgage.
Interest rates are usually higher for buy-to-let properties, and you will typically need a 25% deposit from the total price of the property.
The typical legal conveyancing fees for buy-to-let properties range from £850 to £1500. Additional fees from searches, taxes and other administrative fees will be added on top of these numbers.
Bell Lamb & Joynson
We can be your buy-to-let conveyancing solicitors for your buy-to-let purchase. We offer fast and effective services - and with over 200 years of experience in the business, our advice and services are ones to be trusted.
Purchasing a buy-to-let property can be exciting. Although you won’t be living in it, the investment is still an exciting time with potentially great profits to be made.
With Bell Lamb & Joynson's expert team of conveyancing solicitors, you know your buy-to-let conveyancing process will be in safe and trusting hands, so choose Bell Lamb & Joynson today.