Buy-to-let mortgages are referred to as the investment strategy of buying properties to let for profit. The property may be residential or commercial. However, most individuals opt for residential property to let. Investing in rental properties has long been a profitable business for landlords. Buy-to-let mortgages benefit investors who rent the property to a third party. Usually the rent received is more than monthly mortgage payments on the property. This enables the borrower to make regular payments and save money for maintenance fees. In addition to this, the value of the property appreciates with time accumulating wealth for the investor. Rising property prices and a growing rental market have increased demand for buy-to-let mortgages.

All investments have a certain degree of risk associated with it. Here are a few tips to minimise risk and optimise your profit from a buy-to-let mortgage:

Market research: (Make sure about the rate of return on your investment.- this does not make sense)Make sure about the rate of return on your investment. Explore the various possibilities of investment, before making the decision buy-to-let mortgages. Do some research about the rental market and value of properties in your area. Talk with a friend who has recently taken out a buy-to-mortgage, so as to learn from experience.

Prominent area: Location where there is vibrant rental market. Small families may require nearby schools for their children,or a nearby shopping area for daily needs. Students, singles and working professionals may require good transportation systems close to their office or college. Decide which group you wish to target before investing.

Necessary calculation: It is essential to have an idea about the expected rent your property may fetch at its current market price. As a thumb rule, buy-to-let mortgages should fetch a monthly rent of at least 125% of monthly mortgage payments. This can vary depending on circumstances. Take into consideration the amount required for down-payment and the possibility of your property remaining on the rental market without rent for a few months. Make sure you have enough provision to make monthly mortgage payments you are without tenant for few months.

Best deal: Shop around for the best for buy-to-let mortgages. You may seek advice from professional brokers, use online search engines and invite quotes from reliable financial organisations. Ask for detailed information before finalising a deal. It is advisable to seek professional help if you have a busy schedule.

Target group: Depending on the location and amount of investment, you should decide what type of tenant you’re looking to attract so as to find a suitable buy-to-let mortgages. While students look for cheaper homes near their educational institution, professionals prefer furnished small apartments. Small families look for unfurnished houses to accommodate their belongings that preferably have schools and/or shopping facilities in the vicinity. If you are skeptical about your potential tenant you can take insurance to cover failure of your tenant to pay rent. It is recommended that you use an estate agent for to find your perfect tenant. This saves your time and money.

Slow but steady: Buy-to-let mortgages should primarily aim to accumulate profit from rent rather than look for short term appreciation. If you let rental payments grow over a period of time you can save money paying monthly mortgage payments. Such savings act as emergency funds whereby you build a substantial amount for investing or paying off the mortgage.