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Buy to Let Remortgage Capital Raise Completion in Two Weeks

Buy to Let Remortgage Capital Raise Completion in Two Weeks

The Clients: With a portfolio of seven buy to let properties, our clients were both experienced landlords. Both had other sources of income besides property, with one applicant self-employed and the other with a PAYE salary.

The Property: A three-bed semi-detached house located in a residential area, let out to a single-family. With a standard construction and good location, lenders were likely to see this as a ‘vanilla’ property.

The Finance: Our clients were looking to remortgage their property onto a more competitive rate in order to save money across their portfolio. In the process, they were also looking to capital raise to fund a new investment property purchase.

The Challenge: While this may have appeared to be a straightforward case, there were still some challenges to navigate. Firstly, not all lenders are happy to offer to portfolio landlord clients, due to the added risk of a larger total borrowing across all properties. Secondly, some lenders do not allow remortgages with capital raises, even with details of an onward property purchase. Consequently, our available list of lenders was further reduced. Lastly, as our client is self-employed, we had to provide the lender with additional documentation. This included two years’ evidence of income, and a portfolio and mortgage statement. Requiring this extra information threatened to slow down our client’s application and involved a tougher underwriting process.

The Solution: With our experience on complex buy to let cases and whole-of-market access, we quickly able to identify a lender that would be happy to proceed with portfolio landlord clients and a capital raise. From our knowledge of the market, we also know that the preconception of difficulties with self-employed mortgage applications can be easily resolved by having the correct documentation on hand and a lender happy to work on these types of cases. As a result, we managed to get all the information required to the lender early on and got the case from the decision in principle to completion in just two weeks. This was also made easier by the free legal service that came with the mortgage product rate we sourced our client. See the property details below:

Property Details

Property Details:

Property value: £390,000

Loan amount: £234,000

LTV: 60%

Rate: 1.57% for a five-year fixed term

Term: 25 years, interest-only

Mortgage payment: £310 per calendar month

Lender arrangement fee: £1,995

Rental income: £1,400 per calendar month

Gross yield: 4.3% per annum

Application: Individual

Consultant: Leroy Webster, 01732 471653

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

Mortgages for Business Ltd is registered
in England and Wales No. 2502713.

Registered office:
17 Kings Hill Avenue,
Kings Hill, West Malling,
ME19 4UA.

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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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