BTL mortgage with no ERCs for first-time landlord
A sales manager from Kent approached us looking to invest in his first buy to let property.
After researching different rental areas, he had settled on a two-bed flat located within walking distance of his own home.
The property in question was slightly out of his budget, so his parents had offered to gift the remainder of the deposit required.
On the advice of his accountant, he had set up an SPV limited company through which to make the purchase.
The client had two requests:
- A high loan to value product, so his parents only had to gift him the minimum amount
- A product with no (ERCs) early repayment charges, in case he decided to sell up within the first six months
There is a small appetite for first-time landlords operating via limited companies and the options reduce even further when looking for high loan to value products with no ERCs.
We took the case to a lender which cannot be accessed directly via the public. We spoke with the underwriter and highlighted the merits of the case. Happy that the client was a good risk an offer was made.
Once offered the case took just over 3 weeks to complete.
Property Details
Property value: £237,500
Loan amount: £180,523
LTV: 76%
Rate: 3.49% 2 year discounted
RTI: 145% @ 5.5%
Term: 25 years
Mortgage payment: £533
Lender arrangement fee: 1.5% - £2,707
Rental income: £1,050pcm
Gross yield: 5.3%pa
Consultant: Chris Longhurst, 01732 471607
24th October 2017
