Buy to Let Loan

You may have long thought about purchasing property to eventually let out to third parties, but you may not have been able to do so.

Well, we’ve got some good news for you! Now you can take a loan to buy to let the property you have always wanted to invest in.

Our Buy to Let Loan will enable you to acquire a residential property and finance the repayments from the rental income received.

What’s more, you can still avail yourself of our Buy to Let Loan even if you have other commitments such as a home loan. As long as the rental income will be sufficient to meet the proposed repayment, we will be able to help you.

What are the features of a Buy to Let Loan?

At present our interest rate is 2.5 % over the Bank's Base Rate which is currently 3.95 %, i.e. an effective interest rate of 6.45% per annum.**

You may borrow from a minimum of €60,000 up to a maximum of €600,000. Requests above this amount will be considered on a case-by-case basis.

You may repay the loan over a maximum of 25 years, repayable by age 70 (or up till the age of 65 if personal income is relied upon for repayment).

A one-time up-front processing fee of 0.3% of value of loan is applicable (maximum €698.81).

** Offers may apply from time to time.

What are the benefits of a Buy to Let Loan?

A favourable rate of interest.

Comfortable repayment terms which cater for your particular circumstances.

There are no penalties for making extra monthly payments. An early repayment fee is only be payable if the loan is repaid in full in the first three years.

How much can I borrow?

You may borrow from a minimum of €60,000 up to a maximum of €600,000. However the amount borrowed may depend also on the level of your income.

If property is already being let, you will only have to prove that existing rental income** covers the Buy to Let Loan repayments.

Otherwise, the proposed monthly repayment may not exceed 35% of your disposable income***.

**rental income will have to be netted for all expenses and VAT.
***disposable income is netted of regular commitments such as loan or hire purchase repayments.

How is the level of borrowing calculated on the value of property to be purchased?

If you reside in Malta, you may borrow up to 75% of the lower of the purchase price or a valuation of the property.

If you do not reside in Malta, you may borrow up to 65% of the lower of the purchase price or a valuation of the property.

What security do I need to provide?

You will need to provide us with:

• A General Hypothec in name of all borrowers.
• A Special Hypothec and Special Privilege on the property purchased.
• Pledges on insurance policies covering the property and the life of the borrowers.
• Any other security requested by the bank.

What documents do I need?

To apply for a Buy to Let Loan you would need:

• Your latest payslip and FS3.
• A copy of your Identity Card.
• An architect’s valuation detailing the value of your property.
• Details of expected expenses relating to the rental of the property.
• Any other documents requested by the bank.

What do I do next?

Simple. If you need further information of how you may avail yourself of a Buy to Let Loan you may:

• call at the nearest HSBC Bank Malta p.l.c. branch
• call our Customer Service on 2380 2380
• send us an e-mail