We were approached by a married couple who are full time landlords that have been managing a large portfolio of some 20+ properties for more than 20 years. They were looking to remortgage one of their properties in order to raise equity for further investment.
This property in question is a 3-bed ex-local authority flat in a 4-storey block in the South East which is now 50% privately owned.
The following challenges made finding a lending quite tricky:
- The flat is ex-Local Housing Authority owned
- Lenders that will consider ex-LHA flats prefer more than 50% private ownership
Fortunately one of the new specialist lenders accommodates this type of property and felt comfortable offering the following terms.
Property value: £385,000
Loan amount: £250,250
Rate: 2.69% 2 year fixed
Term: 20 years interest only
Rental income: £1,500 pcm
Mortgage payment: £561 pcm
Gross yield: 4.7% pa
Lender arrangement fee: 1.5% of loan amount (£3,754)
Consultant: Charlie London, 01732 471604