April 8, 2008
Buy to Let in trouble
The changes within the mortgage industry have affected many people, but the hardest hit would seem to be those people who have invested in the Buy to Let market. Many of these people have seen that buying property is a great investment and so to buy a property on a mortgage and rent it out so that other people are paying the mortgage for them, has to be a great deal.
Well it was, but many people have over stretched, and in some cases have even used equity in other properties to act as security and this is where it all goes wrong.
There is a fine line between the mortgage, rent and property values, if just one of these upsets the balance then the whole things begins to collapse around them. This then leaves the owner with debts, tenants homeless and another property going to auction for someone else to buy on the cheap.
Source [This is Money]
http://www.thisismoney.co.uk/mortgages/buy-to-let/article.html?in_article_id=438092&in_page_id=56&ct=5
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