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£400k refinance for large portfolio landlords

£400k refinance for large portfolio landlords

A married couple – both professional landlords approached us looking to refinance one of their rental properties. Between them, the couple own circa 40 rental properties, with a total mortgage borrowing of over £9m.

The property in question is a 3-bed terraced house in West London. Since purchasing the property in 2011 for £185,000 the couple had carried out major redevelopment works on it including a basement and loft conversion. It was now estimated to be worth in the region of £600k.

The couple were looking to refinance for 3 reasons:

  1. They had reached the end of their initial mortgage term and been reverted onto the lender's standard variable rate
  2. They wanted to take advantage of the well-priced longer term fixed rates currently available on the market
  3. They were looking to raise capital for further property investment

With such a large portfolio, the clients had reached the exposure limits set by many lenders, which restricted the finance options available. Thankfully a new lender had recently entered the market, which doesn't impose a limit on borrowing with other lenders.

Happy that the couple were a good risk, the following terms were offered:

Property Details

Property value: £600,000

Loan amount: £429,600

LTV: 72%

Rate: 3.99% five-year fixed

Term: 25 years interest only

RTI calculation: 140% @ 3.99%

Mortgage payment: £1,429 pcm

Previous interest rate: 4.98% (variable)

Previous loan amount: £294,029

Previous monthly payment: £1,220

Lender arrangement fee: 1.5% (£6,444)

Rental income: £2,000 pcm

Gross yield: 4% pa

Borrower: Joint personal application

Consultant: Chris Longhurst, 01732471607

NB: ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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Mortgages for Business Ltd is authorised and regulated by the Finance Conduct Authority (No. 313537) to transact regulated mortgages. We are a credit broker, not a lender. We work with the whole of market in sourcing a lender for you; we may receive a commission from the lender, and this amount varies between lenders. The FCA does not regulate some investment mortgage contracts. Mortgages for Business Ltd is a founding member of the National Association of Commercial Finance Brokers, the body that promotes best practice within the commercial finance industry. Telephone calls may be monitored or recorded for training purposes.

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