Over the last decade, the 'buy to let' mortgage market in the UK has boomed. More and more landlords have entered the market, attracted by the investment opportunities offered by property. Many landlords remortgaged their portfolio to generate additional cash for further property purchases and it was only with the global financial crisis that it became clear that some landlords simply couldn't manage their debt.

In spite of this, it is still possible to earn healthy profits in the buy to let market, especially if you are in a good financial position, which many are not these days. Low risk mortgagees will find that they can easily make good money, especially as property prices in the UK are set to rise and keep rising over the next ten years.

Many people were unable to keep up with repayments during the financial crisis, and there were many people made homeless. That is why there is still plenty of money to be made, as there are now thousands upon thousands of people who are unable to buy, and are turning to the rental market for a place to live.

Encouraged by positive media coverage of the booming property market, it was not surprising that thousands of novice landlords entered the property market over the last decade. Unfortunately, many of them borrowed more than they could afford and, in some cases, more than the rental income the property generated. So, when the economy began to slide into recession, rental demand fell and landlords were left with empty proper
ties generating no rental income.

So, if you are planning to remortgage your own home or other investment property to build your portfolio, how can you avoid these mistakes? Firstly, it is important to realize that the rental market is like many other markets in that it will have both good and bad periods.

When the property market is booming it may seem like a good time to expand your property portfolio. However, it is also the idea time to use your surplus cash to reduce the borrowings on your properties. This puts you in a much stronger position when the market turns against you as you will have less debt to service.

You should be realistic with your planning too, as it is likely if you are renting to students or younger people that there may be times when they pay their rental payments late or miss payments altogether.

Students are particularly high risk, as their plans can change regularly and very quickly, so you may find that tenants leave without notice and suddenly. It is always a good idea to get details of whomever if paying the rent so that you have some form of backup if this happens.

The most important thing is don't expect to get rich quick. That's not how the buy to let market works. A sensible landlord will build their business gradually, but this will be more stable and far more likely to last into the future.

So the advice is to never take on a property that you cannot afford to fund if the rent is not being paid, and never rush in without taking the time to think about all of the pros, cons and repercussions of defaulting on a loan.