The Client: An experienced landlord with an extensive buy to let portfolio of more than 40 properties.
The Property: Situated on the outskirts of London, the property was a three-bedroomed semi-detached family home. With plenty of living space and a substantial garden, the property would appeal to many families in the area and would be an excellent addition to our client’s portfolio.
The Finance: Having capital raised a deposit from his existing buy to let portfolio, our client required a 75% LTV mortgage to purchase the house.
The Challenge: The initial challenge was to source a BTL lender that could accommodate a landlord applicant with such a substantial background property portfolio. However, the main complexity with this case was that our client had a historical County Court Judgment (CCJ) on his credit history, which would mean an immediate rejection for many lenders.
Lastly, our client wanted to complete the purchase before the June 2021 stamp duty holiday deadline, meaning we’d have to work hard with the lender to get the case through in time.
The Solution: Firstly, we spoke to our client about the circumstances of the CCJ. Doing so would enable us to explain the situation upfront with a lender so that they could assess the case on an individual basis, rather than just a criteria tick box.
Armed with the whole background of the credit issue, we set about researching BTL lenders that could accept a portfolio lender with more than 40 background properties. From there, we assessed the more granular criteria around credit scores to find lenders that would at least consider the application.
Once we found a possible lender, we set about making our clients’ case on their behalf and demonstrated to the lender that this prolific landlord would not be too high risk for the books. We also discussed the need to complete before the stamp duty deadline, and the lender was confident it could meet the requirement. We submitted the application and ensured it stayed on track through to completion. All in all, the whole case took just eight weeks to complete. Here are the details:
Property value: £600,000
Loan amount: £444,221
Rate: 3.39%, 5-year fixed
Term: 25 years, interest-only
Mortgage payment: £1,280 per calendar month
Lender arrangement fee: 2%
Rental income: £1,800 per calendar month
Consultant: Adam Henderson, 01732 471658
6th October 2021