First-time Landlord Purchases Multi-Unit Freehold House
The Client: A first-time landlord looking to turn his investment dreams into reality through purchasing their first buy to let property.
The Property: A detached Victorian house in southwest England previously renovated into four individual flats. The multi-unit property is in a perfect location for professionals and small families working in the city.
The Finance: Through extensive savings over the past few years, our client had £70,000 available for the deposit. On their accountant's advice, our client incorporated an SPV Limited Company before enquiring.
The Challenge: This case had two challenges which combined, made the case complicated to place.
The primary challenge was finding a lender that accepts first-time landlords looking to invest in multi-unit properties. Most specialist lenders require the landlord to have a minimum of 12 months of experience before lending on multi-unit buy to lets due to the higher risk factor associated with multiple tenancy agreements.
The second issue was the client still being in their probation period, limiting the number of lenders we could approach even further.
The Solution: As a specialist buy to let mortgage broker, we have extensive experience sourcing finance for first-time landlords purchasing with complex employment history. Using our full market access, we quickly identified the buy to let mortgage lenders with criteria that covered our client's property needs, experience and income structure.
Despite their probation period, the lender was happy to proceed after receiving evidence of the client's current employment contract. Our client was delighted to start their property investment journey and secure their new source of income. Here are the details:
Property Details
Property value: £280,000
Loan amount: £210,000
LTV: 75%
Rate: 3.39% 2-year fixed rate
Term: 25 years, interest-only
Mortgage payment: £602 per calendar month
Lender arrangement fee: 1.5% of loan (£3,150)
Rental income: £1,870 per calendar month
Application: SPV Limited Company
Consultant: Agata Rogozinska, 01732 471602
24th November 2021
