I'm looking at renting out my flat and taking out a bit of wedge against a third of it's value in order to buy some cool shit. I'm currently looking around for buy to let mortgages and residential mortgages with a consent to let clause.

I'm amazed at the huge variation in price for basically the same product.

Thus far for a fixed rate 5 year deal (interest only), I've been quoted nearly £800 a month by Natwest or £420 a month by some broker off the internet.

So what's the score? Why the massive variation? What's the risk of going with a small broker? What are the benefits of going with Natwest, HSBC, Lloyds, Barclays etc?

Confused of Cheam.

Originally Posted by Ravers

I'm looking at renting out my flat and taking out a bit of wedge against a third of it's value in order to buy some cool shit. I'm currently looking around for buy to let mortgages and residential mortgages with a consent to let clause.

I'm amazed at the huge variation in price for basically the same product.

Thus far for a fixed rate 5 year deal (interest only), I've been quoted nearly £800 a month by Natwest or £420 a month by some broker off the internet.

So what's the score? Why the massive variation? What's the risk of going with a small broker? What are the benefits of going with Natwest, HSBC, Lloyds, Barclays etc?

Confused of Cheam.

Thats a big difference in an interest only mortgage what rates are they both offering on how much.

Be very wary of the fees independent brokers charge, this can sometimes be alot more than the banks charge.

I did notice that ElCheapoNorthernMortgages.com wanted a 500 quid arrangement fee, but to be honest I'd happily swallow this given that I'd be paying nearly £400 a month less than Natwest.

Originally Posted by Ravers

I did notice that ElCheapoNorthernMortgages.com wanted a 500 quid arrangement fee, but to be honest I'd happily swallow this given that I'd be paying nearly £400 a month less than Natwest.

What are the rates? And how much are you borrowing? It must be a bloody good mortgage if thay are offering half the interest rate of Natwest.

I've just had a look at Natwest site and the best mortgage I can see for 5 years (40% deposit) is 3.79% (although I don't know if its interest only)

If another company is offering slightly over half of this, its asking for about 2%. Have you made a mistake anywhere because that would be a very, very good deal.

2.45% fixed rate, this is for 2 years though not 5.

Originally Posted by Ravers

2.45% fixed rate, this is for 2 years though not 5.

Sounds very good, have you got a link? Check their product fee (seperate from advisors fees)
Also if you can get a residential mortgage (its normally cheaper) and then 6 months later tell the bank you have taken a tenent to help meet the costs. The banks generally dont give a fuck so long as they are getting their cash. (I got that advice from a mortgage advisor at TSB).

I just did a quick google and found a Building society offering a two year at 2.59% with LTV 75%
Total fees 1140 quid, (Thats arrangement, completion and exit fee)

2 Year Fixed Rate Mortgages

No linky to the deal I was offered I'm afraid, done over the phone, but I think it's this lot: Best Remortgages Deals, Fixed Rate Mortgages, Brokers, Remortgage Offers Company, House, Search, Mortgage Payment Calculator UK | Sensible Mortgage Solutions

It's a residential mortgage with a consent to let clause, which basically means I'll live there for a month and then get a tenent.

I'm seriously tempted by the good price and there doesn't appear to be any downside or catch, just wondering if anyone else would trust an unheard of bunch of Northerners with a third of their home? Will Jim Davidson come round a break my kneecaps if I miss a payment for instance?

Originally Posted by Ravers

No linky to the deal I was offered I'm afraid, done over the phone, but I think it's this lot: Best Remortgages Deals, Fixed Rate Mortgages, Brokers, Remortgage Offers Company, House, Search, Mortgage Payment Calculator UK | Sensible Mortgage Solutions

It's a residential mortgage with a consent to let clause, which basically means I'll live there for a month and then get a tenent.

I'm seriously tempted by the good price and there doesn't appear to be any downside or catch, just wondering if anyone else would trust an unheard of bunch of Northerners with a third of their home? Will Jim Davidson come round a break my kneecaps if I miss a payment for instance?

Check the small print, the fees can include (and are not limited to) the arrangement fee of the broker which you have already said is 500 notes to the arrangement of the bank (Not always the same as the broker), completion and exit fee, some also charge for a valuation. And missed payments can be drastically charged (some banks offer a payment holiday)
A lot of people make the mistake of going for the cheaper percentage rate but pay a massive amount of fees (This normally only works out cheaper if you are borrowing a lot)
Natwest are offering a 3.25% (With restictions) on a LTV of 70% but no product fee.
You need to work out if paying 2.45 + fees is cheaper than paying 3.25 with no (or little) fees.