as you have cash, you don't need to worry about mortgage interest relief reductions, but it might be worth looking at getting 3 £100k rentals with 30% deposit mortgages, provided you can get them comfortably below market rate. if you set up a shell company first, then you can offset the mortgage interest against tax (this is what is being reduced for private landlords). much of what is said above is excellent advice. here is what I have found in 6 years of being an "accidental landlord" (couldn't sell my last house, so put it up for rent instead); using an agent has been very helpful in the outset, getting all of the right contracts in place, vetting tennants, getting guarators in place and vetted, gas certs, elec certs, etc - I am now looking to drop the agent, as they have had their pound of flesh, and I am more confident in the processes ongoing; on the flip side of this, my friend down in Caerphilly has just got his 1st BTL and done it all himself but has got his brother in law as a tennant with father in law as guarator - he is just a bit lucky I suppose; getting good tennants with references, previous rental info, etc is absolutely vital; maintenance is something that crops up on things you least expect and at times that are very inconvenient (the rental boiler went kaput at the same time as my home boiler went kaput - big outlay in the middle of winter) - if you can do things yourself, e.g. mending broken locks, leaking radiators, etc then do it, and keep records of everything you spend as this can be offset (or if you don't have the time, then get reliable workies/tradesmen (reliable and tradesman don't usually crop up in the same sentence) and get all receipts) you can also claim mileage to/from the property at 45p/mile. keep on top of the maintenance, as a happy tennant tends to be far less hassle, and they can get difficult if you let something go for a period of time such that they can claim their health has been affected, etc; on the peer-to-peer lending, the rates are definitely much lower than @Birdie is getting (must have got in early). my current average rate from ratesetter is 3.8%, today they are showing the rolling market at 3.1% (almost instant access), 1 year market at 3.9% (locked for 1 year), and 5 year market at 4.0% (locked for 5 years). my current rate on Zopa is slightly higher, but is more risky. your money, your choices, but always trust your instincts. Good luck. Pete
5 year, I have never lent below 5% in the five year, normally 3.3+ in the monthly, have only ever used the 1 year once and I got 4.5 in that. I have all repayments go into my holding account and lend at the end of the month for better rates. Steve. PS my Zopa statement. Your average interest rate after fees: 6.4% this week 7.0% from 24/03/2017 to 23/04/2017
