We were approached by a doctor looking to purchase his first buy to let property – a 4-bed HMO in Croydon.
Hoping to build a property portfolio over time, the client had set up an SPV limited company through which to make his purchases.
There were two main challenges with this case that would limit the number of finance options available.
- Very few buy to let lenders offer 80% LTV
- The client is a first-time landlord. Most lenders like to see experience, especially when it comes to renting out HMO property
Keen to protect himself from any rate rises in the near future the client had also requested a five year fixed rate.
We took this case to an intermediary only lender, which was happy to assist.
Property value: £408,000
Loan amount: £326,400
LTV: 80%
Rate: 4.59% 5 Year Fixed
RTI: 140% @ 5%
Term: 25 years interest only
Lender arrangement fee: 2% (£6,528)
Borrower: SPV Ltd Co
Mortgage payment: £1,248 pcm
Rental income: £2,900 pcm
Gross yield: 8.5% pa
Consultant: Nick Helm, 01732 471608
ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
