Let to Buy Application for First-Time Landlords

The Client: Our clients were a couple, both in full-time employment, looking to take their first step into property investment. As both clients were in the higher tax bracket, they had recently opened a Limited Company as joint directors.  

The Property: A two-bedroom apartment located in a popular and busy Northern city centre. The property was close to shops and restaurants, the business hub, and the city's universities. Our clients lived in the property at the time of application but were moving to a new home, ready to rent out their existing flat.   

The Finance: Our clients needed a buy to let mortgage for the property, and they were moving the ownership of the flat into their Limited Company. This process is what's known as a let to buy.

The Challenge: Not many lenders provide let to buy mortgages, which limited the number of lenders available to our clients. Additionally, our clients were both first-time landlords and required a limited company mortgage. The combination of these factors dramatically reduced their options.

The Solution: Our experience and knowledge of the buy to let market meant we quickly identified a suitable lender happy to offer on let to buy applications and first-time landlords. We also presented a clear plan for our clients, demonstrating that an onward residential purchase would occur simultaneously with this transaction. Our plan satisfied the lender's requirement that our clients had a new home to move into, and they were happy to make the mortgage offer. Our clients were happy to proceed, having secured them a competitive deal with all their requirements accepted. Here are the details: 

Property Details

Property value: £150,000

Loan amount: £112,500

LTV: 75%

Rate: 3.44% 5-year fixed term

Term: 25 years, interest only

Mortgage payment:  £327 per calendar month

Lender arrangement fee: 1.5%  £1,687.50

Rental income: £825 per calendar month

Gross yield:  6.6% pa

Application: SPV Ltd Co

26th October 2022