The clients: A father and son looking to raise funds to expand their property portfolio. In total the pair own 15 properties, all of which are held within their SPV limited company.
The father is a full-time landlord and the son works as a property manager. Both have an equal shareholding in their company.
The property: The pair were looking to refinance one of their rental properties – a 1970s end of terrace house in Essex. The property is currently let to a young family and generating a steady rental income of £1,350 pcm.
The finance: To raise the amount required, the pair were looking to borrow at 72% loan to value. Unsurprisingly, the pair had requested a five-year fixed rate. According to the results from our latest Buy to Let Mortgage Index, 96% of landlords borrowing via Mortgages for Business chose a fixed rate in Q3 2018, with 73% of these borrowers opting to fix for five years.
The application: To get the ball rolling on their next purchase, the clients were hoping for a quick turnaround time.
To help move the application process along, we sent the pair our Property Portfolio Spreadsheet template for completion and worked within them the collate the other standard documentation.
We decided to approach a well-known building society which has recently introduced a set of buy to let products with some rather unique USPs.
- No personal guarantees required! This is the only buy to let lender with this niche USP at 75% LTV
- Portfolio landlords accepted with no limit on borrowing with other lenders
- No floating charges taken
We submitted the case and received an offer back within one week! The case is due to complete shortly – within two months of receiving an offer.
Here are the details of the deal:
Property value: £365,000
Loan amount: £262,500
Rate: 3.69% 5 Year Fixed
Term: 25 Interest only
Lender arrangement fee: £1,312 (0.50% added to loan amount)
Previous mortgage payment: £1,050
Mortgage payment: £846 pcm
Rental income: £1,350 pcm
Gross yield: 4.4% pa
Consultant: Deepinder Bhangoo,01732 471 661
20th November 2018