We were approached by a couple, experienced private landlords and business owners, who wished to remortgage a large building made up of five small shops with seven residential flats above located in a popular Essex town.
The clients needed to remortgage because their high street bank had called in the loan because it no longer lends on mixed use properties.
The clients were looking for personal finance, not via a limited company.
Unfortunately, the clients’ record keeping was haphazard to say the least and it proved difficult to accurately show the declared rental income and tenancy agreements.
This meant that, initially, no lender was willing to touch the case.
Working closely with the couple we helped to organise the record keeping and bring the paperwork up to date.
This enabled us to compile and put forward a strong proposal to a lender which, after some negotiation, agreed to lend sufficient to pay off the existing loan and raise an additional £100k to fund an extension to another of the clients’ rental properties.
Here are the details of the deal:
Property value: £2,190,000
Loan amount: £900,000
Loan to value: 41%
Rate: 4.3% term tracker (3.8% + BBR)
Term: 25 years capital & interest
Mortgage payment: £4,901 pcm
Rental income: £11,670 pcm
Gross yield: 6.4% pa
Lender arrangement fee: 1.5% (£13,500)
Consultant Mortgage Broker: Nick Helm
Consultant telephone: 01732 471608