SPV remortgages 2 London properties for further BTL investment

We were approached by a broker looking for finance for his clients – a married couple who wanted to raise capital for further property investment.

The clients are full-time landlords owning five properties within their SPV limited company of which they are both directors and equal shareholders.

They were looking to remortgage two properties - a multi-unit consisting of two flats, and a four-bed semi-detached house.

The number of lenders willing to look at the case was restricted for two main reasons:

  1. Despite owning rental property the clients don’t own their own home

  2. They own both the freehold and leasehold titles of the multi-unit property – many lenders will not accept these types of “associated” or “related” transactions.

However with approximately £3m of equity within their portfolio, Keystone considered the directors to be a fair risk so offered the following separate terms on each property:

After discussing the most suitable option for their circumstances, the clients decided to purchase the property via a SPV Limited Company.


Multi-unit value
: £850,000

Loan amount: £579,600

LTV: 68%

Rate: 5.19% 5 year fixed for limited companies

Term: 25 years capital & interest

Lender arrangement fee: 2.25% (£13,041)

Mortgage payment: £3,453 pcm

Rental income: £3,600 pcm

Gross yield: 5.8% pa

 

4-bed house value: £525,000

Loan amount: £391,750

LTV: 75%

Rate: 4.99% 3 year fixed for limited companies

Term: 25 years capital & interest

Lender arrangement fee: 2.25% (£8,814)

Mortgage payment: £2,288 pcm

Rental income: £2,400 pcm

Gross yield: 5.5% pa

Consultant: Gareth Richards, 01732 471 627

Consultant