A married couple approached us for help in getting a buy to let mortgage to buy a 3-bed semi in the Wirral which is already tenanted and generating a monthly income of £600 pcm.
The couple are both in full-time employment in the healthcare industry and also personally own a small portfolio of rental properties. On the advice of their accountant they had set up a Special Purpose Vehicle (SPV) limited company through which to make further buy to let purchases because it will be more tax efficient for them.
As the pair were only looking for a loan of £72,000, this would reduce the number of lenders available to them because some will not lend below £75,000. They also requested a five year fixed rate to protect themselves against potential rate rises in the current uncertain market.
Taking all of their requirements into consideration we approached an intermediary only lender with which we have semi-exclusive access.
This particular lender has a minimum loan threshold of £50,000 and is currently offering some extremely competitive five year fixed rates which are available to limited companies as well as individuals.
Here are the details:
Property value: £96,000
Loan amount: £72,000
Rate: 3.99% 5 year fixed
Term: 5 years interest only
Lender arrangement fee: 2% (£1,400)
Borrower: SPV Ltd Co
Mortgage payment: £240 pcm
Rental income: £600 pcm
Gross yield: 7.5% pa
Consultant: Chris Longhurst, 01732 471650