We were approached by a part-time landlord with two existing buy to let properties looking for help sourcing funds to purchase a buy to let property.
The property he wished to buy is a 3-bed semi-detached house in good, letting condition located in a large town on the South Coast.
The client’s situation caused a few challenges when sourcing funds because:
• He had only been at his job for one month
Some lenders would be cautious of this as the borrower has not passed the probation period and is therefore in a less secure position
• His annual income is less than £25k
Many of the mainstream buy to let lenders impose a minimum income of £25k pa, so the choice of suitable products was restricted
• He doesn’t own his own home
Many lenders prefer borrowers to own their own home before owning buy to let properties
In the client’s favour, he has landlord experience and already owns two other buy to let properties.
We approached a high street lender with this deal as the client fitted its criteria and it offered the following deal.
Property value: £154,000
Loan amount: £115,500
Rate: 2.99% 2 year fixed
Term: 20 years interest only
Mortgage payment: £287 pcm
Rental income: £795 pcm
Gross yield: 6.2% pa
Lender arrangement fee: 2.5% (£3,875) added to loan
Consultant Mortgage Broker: Andy McOwat, 01625 416396