Two directors of an SPV limited company approached us looking to purchase a four-bed HMO for letting to students. The directors are both full-time landlords with over ten rental properties between them.
Although profitable landlords, the pair had recently carried out some refurbishment works on a few of the properties in their portfolio and offset the costs against the company’s accounts.
This had caused their income for the recent tax year to be under £25k – something most lenders will not accept.
The clients were also keen to secure a five year fixed rate to protect them from potential rate rises in the near future.
Our own lending brand Keystone Property Finance was able to assist in this instance. Happy with the company’s experience in letting rental property and accounts from previous years.
The following terms were offered:
Property value: £450,000
Loan amount: £337,500
Rate: 4.59% 5 year fixed
Term: 25 years interest only
Borrower: SPV Ltd Co
Lender arrangement fee: 2% (£6,750)
Mortgage payment: £1,315 pcm
Rental income: £2,800 pcm
Gross yield: 7.5% pa
Lender name: Keystone Property Finance
Consultant: Paul Martins, 01732 471616