02 Mar How to make the right mortgage decisions
First of all, you need to be clear about the type of property investment you’re making.
Mortgage lenders will want to know what you are going to be using the property for. Is it a buy-to-let for students or regular tenants, a buy-to-let for tenants on benefits, or a house of multiple occupation?
How to keep your property investment on track
Once negotiations are over, and your offer has been accepted, it can be tempting to sit back and let the legal process take its course.
However, if you fail to keep your property deal on track, you run the risk of things going wrong at the last minute.
Set a timeframe
If you’ve got a mortgage agreed in principle, this offer is only valid for a set period of time. You don’t want to find yourself in a situation where the deal has taken so long to finalise, you’ve lost the mortgage offer you had, and you can’t get another on the same terms.
Keep things on track by getting all your paperwork together in advance. This could include documents such as your mortgage agreement, any proof of income required, as well as proof of identity and address.
Also, it helps to set a date for exchanging contracts. This way, you give everyone the same deadline to work to and focus on.
Take action promptly
When you’re asked by your solicitor to read, sign and return documents, don’t let them sit around on your desk for ages.
Delays on both your side and on the vendors can add a significant amount of time to completion of the legal process.
Keep communication going
Once you have your team of professionals in place such as solicitors, surveyors, estate agents, letting agents, removal companies, etc. try and act as the linchpin. Make sure communication channels stay open, and each party is aware of the next steps.
You should aim for at least weekly updates with your solicitor and the property agents.
If you’re dealing with an estate agent, it’s a good idea to check that the property has been taken off the market.
Line up suitable tenants in advance
If you’re investing in a buy-to-let or HMO, you don’t want the property to be empty when it can be earning rental income.
Ideally, you want to have tenants lined up to move in as soon as you complete, unless you’re planning to refurbish the property first. However, you’ll need to do identity and credit checks before signing any tenancy agreements.
To avoid a delay in this process, make sure you know in advance who’s going to be carrying out these checks. Do you intend to manage the property yourself, or will you appoint a letting agent?
If you don’t want the hassle of sourcing and referencing tenants, then get an agent to manage that aspect. If you also want to outsource maintenance of your property, then take out a full management service with the agent. They will then cover all this, as well as carrying out regular inspections of your property to ensure it’s being suitably maintained.
By completing tasks in advance, keeping on top of paperwork, and making regular calls to all parties, you can keep your property investment on track – and ensure it starts working for you as early as possible.
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