We were approached by one of our regular brokers about a remortgage and a mortgage for clients who are already Keystone borrowers.

The clients, a married couple, were looking to remortgage one of their rental properties to raise a deposit for their next buy to let purchase.

The couple are both retired with a small pension each. They also own around 25 rental properties, the majority of which are owned in the husband’s personal name.

The broker brought the case to Keystone because he knew that we could help with all of the following challenges that can make the case difficult to place elsewhere:

• The couple are both in their 60s limiting the mortgage term available to them

• The couples’ income is made up of pension and rental income

• The couple needed the remortgage funds in a hurry in order to complete the next purchase with a Keystone mortgage and beat the introduction of the stamp duty surcharge

The remortgage was to take place on a semi-detached house in Greater London which the couple have owned for more than 15 years.

The existing mortgage had a small outstanding balance on it of just £25,000. The deposit raised would be used to purchase a similar property in the same area which the couple expect to let for £1,450 pcm.

Here are the details of the deal which completed in good time allowing the couple to avoid the stamp duty surcharge, saving them £10,800:

Remortgage

Property value: £420,000

Loan amount: £275,000

LTV: 69%

Rate: 4.99% 5 years fixed

Term: 18 years interest only

Lender arrangement fee: 2% (£5,500)

Mortgage payment: £1,144 pcm

Rental income: £1,450 pcm

Gross yield: 4.1% pa

Purchase

Purchase price: £360,000

Loan amount: £270,000

LTV: 75%

Rate: 4.99% 5 year fixed

Term: 18 years interest only

Lender arrangement fee: 2% (£7,200)

Mortgage payment: £1,122 pcm

Rental income: £1,450 pcm

Gross yield: 4.8% pa

Consultant: Gareth Richards, 01732 471627