Mortgages For Business: Buy to Let Case Studies

Refinance of freehold block of flats on interest-only basis (estimated November 2011)

Oct 10 2011 12:00AM

The client owns a freehold block comprising six self-contained flats all let on Assured Shorthold Tenancies. Their high street bank was reluctant to renew existing facility and would only proceed on a capital and interest basis from the previously agreed interest only arrangement. The lender also wanted to review the file every six months (and charge a fee!). The client felt it would be better to switch lenders for the medium term and take advantage of the interest only option to preserve cash flow.

Finance-raising secured on property for further purchase and to clear debts (October 2011)

Oct 10 2011 12:00AM

The client owns a buy to let property outright. She has no personal income except the rent (only about c£600 pcm) and £500 per quarter from another source. She has £50,000 of credit card debts and is looking to raise funds on the unencumbered property to clear her credit card debts and provide a deposit for a second buy to let property. She was struggling to find finance because of the small amount of personal income and the large amount of unsecured debt. We found a lender who could help.

Purchase from directors’ to limited company to directors (October 2011)

Oct 10 2011 12:00AM

Three directors of a limited company which built two new houses a couple of years ago using a development facility wished to buy the properties from their own limited company for tax purposes but as the majority of buy to let lenders will not entertain this type of related transaction they approached us for assistance. I found a lender who is happy with this scenario and the transactions are now proceeding.

BTL mortgage arranged in 5 days to release funds for further investment (September 2011)

Oct 1 2011 12:00AM

The applicant needed to raise a 75% mortgage on an unencumbered BTL property. Needed it completed within a week to take advantage of an investment opportunity. Application was received and agreed in principle on the same day. The surveyor visited the property the next day and got report back to the lender on the third day. The offer was then issued and on day five the money was in the client’s bank account.

Finding finance for an ex-local authority flat on the sixth floor (September 2011)

Sep 30 2011 12:00AM

The client had bought the property six months before in cash. The flat had 60 years remaining on the lease and he was struggling to find finance in order to purchase another investment property despite the fact he had a tenant lined up ready to move in. We were able to help.

Business partner buys three new terraced houses (July 2011)

Jul 25 2011 12:00AM

Two business professionals formed a partnership to build a development of seven terraced houses. One partner wanted to buy three of the properties out of the partnership to add to his own portfolio. Due to lender concerns on risk exposure on one development, I arranged three separate mortgages with different lenders. The example below is for one of them.

Reversion rate concern (March 2011)

Mar 11 2011 12:00AM

Buy to let portfolio client was fed up with being linked to either i) Standard Variable Rates controlled by the lenders or ii) 3 month LIBOR, which over the last few years has proved more volatile and more expensive than Base Rate!

Exit provided for short-term bridging finance (February 2011)

Feb 24 2011 12:00AM

Experienced property investors purchased freehold property at auction using bridging finance. Bridging finance was used as the property was in need of refurbishment – the property was also split into two self-contained flats. We arranged the end funding to clear the bridging finance and recover the refurbishment costs.

Raising capital on five unencumbered, self-contained flats on single freehold title (February 2011)

Feb 9 2011 12:00AM

I received an enquiry from a high street broker who was struggling to place a deal for a client who was seeking £150k against a single freehold property comprising five self-contained flats valued at £750k with rent of £3340 pm. The client had substantial outside income and required the funds to carry out work on one of his existing buy to let properties and fund the deposit for a further purchase. Our extensive database of specialist lenders indicated that one lender to which the wider market does not have access would be able to look at the deal and we are currently awaiting an offer.

Multi-unit property refinance for an ex-pat (January 2011)

Jan 10 2011 12:00AM

Obtaining mortgage finance for freehold properties split into self-contained flats is not easy. The additional complication that the property title would be in three family names, one of which was resident in Australia. As this was a capital raising exercise to buy out another member of the family they did not want to omit one of the borrowers.

New leasehold title (December 2010)

Dec 27 2010 12:00AM

This client has owned a freehold property comprising three self-contained flats for many years and wished to raise finance against newly created leasehold titles. Read more...

Re-finance of a recently completed development of 28 flats (December 2010)

Dec 20 2010 12:00AM

An experienced property developer sought our assistance as his existing, high-street lender was pressing for repayment of the development loan.

Buy to let with a gifted deposit (December 2010)

Dec 17 2010 12:00AM

A son and daughter-in-law were looking to purchase their parents’ property on a buy to let basis.

Auction purchase of multi-unit freehold block requiring finance urgently

Dec 15 2010 12:00AM

Enquiry from a client advising that she had purchased a property at auction two weeks before believing that her bank would provide the necessary finance. The bank then decided not to lend and we were approached to arrange finance as a matter of urgency. Read More...

Property in need of TLC! (November 2009)

Jan 6 2010 12:00AM

This landlord contacted us via the internet as he needed assistance in purchasing a purpose built flat, in a good location, in need of some refurbishment to make it habitable. He had sufficient capital to fund the work but didn’t want to tie up all of his cash long term.

Holiday Let Purchase (October 2009)

Jan 6 2010 12:00AM

Client approached MFB to fund a holiday let in the Lake District.

The challenge here was that the provision of funds for holiday letting has been severely restricted by buy-to-let lenders in the last 18m. In addition we needed a lender that would consider the holiday letting income rather than assess the borrowing amount based upon a single ‘family let’ basis. To compound the issue the client was working abroad for a multi-national company.

New Build properties in the name of a Limited Company (December 2009)

Jan 4 2010 12:00AM

Having completed a couple of new build houses, the developer decided to keep hold of the properties rather than sell them in a depressed market. The properties were held in the name of his Limited Company.

HMO with works required before letting (Dec 2009)

Jan 4 2010 12:00AM

Applicant approached us looking to purchase a House of Multiple Occupation. Works were required to bring the property up to standard and to obtain the necessary licence from the local authority. The dilemma here was that funding was required to assist in the purchase albeit that the property was not in a position to generate the required income from day one.

Refurbished Flats over a Café & Tattoo Parlour! (November 2009)

Jan 4 2010 12:00AM

An experienced landlord had recently purchased and renovated two leasehold flats above a parade of shops, along a busy main road into South London.

He had already encountered difficulty in raising finance because one of the adjacent commercial premises below was a cafe and the other a tattoo parlour. Also, he had owned the flats for less than 6 months.