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100% residential mortgages on rental property

Like I said on the introduction page to this section, some of the things on this website are not recommended to try or do, they are just stories of my own personal experience.

I started buying property in 1992. My first property was to live in, bought jointly with my partner Adrian. When we split a few years later I had some of the equity to put as a deposit on a very small house in Wolverhampton.

Things went bad for me in Wolverhampton and I had to leave, and around 1999 I rented it out and moved to London renting a flat. After being down there a year I realised I would stay so began to look for a property to live in. I found a small 1 bed ground floor flat for around 36k in Dagenham and quickly bought and moved into it. I had to have ground floor because I had a dog that used a dog flap.

In my mission to find the ground floor flat I had registered with lots of agents looking for these Ex Local Authority, small, cheap flats, and not long after I moved in I started to get calls on more and more flats in the area. I thought long and hard about property as my house in Wolverhampton was doing ok and I had dreamed of expanding my property ownership.

Whilst I was living in this 1 bed flat I met someone and moved in with into a brand new townhouse with a joint residential mortgage and the 5% deposit paid. Renting out my second property … things were looking good.

My circumstances changed and my health deteriorated rapidly with a serious back injury I had in 1997, I was off work sick for a long time but during this time I was offered one I could not turn down, 66k for a 2 bed in Dagenham – when most of them were around the 79k mark. The lady had died and the family wanted rid quickly. My only option at that time was to apply for a residential at that time – and the only product available to me – as I was off sick and that would let me fix it up was a 130% mortgage with North Rock. So I applied and was surprised to get approved quickly.

So with 30% cash back in my pocket I managed to refurbish the property and rent it out in about 6 months.

I was making a small positive cash flow on this property as well as the Wolverhampton now, and my own property had gone up in value. I was very aware that I may not be able to return to work, and that building up a property portfolio would substitute my income considerably.

After I had rented this one out I was offered another one, closer into London in Hackney. It was worth about 200k, but I could get it for 180k as it looked a little tatty (was only very basic cosmetics costing around £500 to put right). I snapped it up after applying for another 100% residential mortgage, and using some of the 30% cash back I had from the one before for all the valuation and solicitor fees. I rented out this one quickly and again had a small positive cash flow.

It was getting addictive, buying property. I felt really good – I wasn’t even 27 years old and already had 4 properties rented out and 1 I was living in.

Next one (number 5) was in Romford, a 2 bedder looking like Wayne and Waynetta slob had lived there. I snapped it up for 60k on a 100% residential with the Halifax, and they also agreed to re-value after works to it and release money for refurbishment. Within a short time it was worth 80k.

During all this time I was still off work sick, mostly in bed and unable to walk unaided – but pretty determined to make sure I had an income and could get off benefits. Lucky for me I was still employed – and our financial advisor at the time knew what lenders would only ask my employer what my salary was – and not ask me to prove I was getting it.

Advertising for people who needed a quick sale, I found a newish property across the road from the 1 st Dagenham flat I had bought that a couple wanted to fix the price and exchange now so that they could reserve a new house for later in the year. I snapped it up for around 170k and then rented it to a lady that started to work for me.

During this last purchase we found a new 4 bed for ourselves to move into and got another deposit paid property in Essex, so rented out our new 3 bed townhouse (rental number 7).

So this is how I started …. Between 1992 and 2002 I owned 7 rental properties, all with 100% mortgages, and 1 more joint with my husband that we lived in.

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