We were approached by an ex-pat who has been living in Europe for three years, who was looking for finance to purchase his second buy to let.
The property is a two-bed flat in a newly built four-storey building which the landlord wished to let the flat to professionals.
The number of lenders we could approach was restricted for two main reasons:
- The client does not live in the UK - many lenders see this as a high risk because it can be difficult to establish a complete credit profile.
- Client is self-employed - most lenders that accept ex-pats prefer borrowers to be employed by an international organisation because they are perceived to be less of a risk.
Thankfully the client still has a reasonable credit profile within the UK and was able to provide accountant certificates proving his income.
This proved invaluable to the intermediary-only lender we approached. The fact that the client had experience as a landlord also helped.
After discussing the most suitable option for his circumstances, the client decided to purchase the property personally rather than via a corporate structure.
Here are the details of the deal:
Property value: £499,000
Loan amount: £374,250
Rate: 4.99% 2 year fixed
Term: 25 years interest only
Lender arrangement fee: 2.5% (£9,356)
Mortgage payment: £1,556 pcm
Rental income: £2,200 pcm
Gross yield: 5.3% pa