We were approached by a married couple looking to purchase their second buy to let property - a 3-bed terraced house in Manchester.
Before renting out the property the couple were planning to convert it into two self-contained flats. Not only would this increase the potential rental income it would also increase the overall property value by circa £60k.
Neither husband or wife had ever carried out a project like this before, so we needed to approach a lender which would offer short-term finance to inexperienced applicants.
The couple expected the works to take just over six months to complete at which time they plan to refinance onto a buy to let mortgage.
Funds were received within 28 days of applying.
Here are the details of the deal:
Property value: £134,000
Loan amount: £93,800
Expected value(after works): £200,000
Rate: 1.25% per month
Term: 9 months
Lender facility fee: 2% (£1,876)
Lender exit fee: interest for 1 month
Monthly payment: £1,172
Rental income: £1,500 expected after works complete
Anticipated yield: 9% pa
Consultant: Gavin Elley, 01625 416398
5th July 2017