Limited Company mortgages
Limited company mortgages have only become a common topic in recent years. Previously they were used by very large developers with portfolio’s numbers of perhaps 20 to 100 properties. When the credit crunch came, they became much harder to finance, and activity dropped sharply. Now new government rules all make buying with a limited company much more appealing:
Houses of Multiple Occupation (HMO)
Houses of Multiple Occupation (HMO’s) have been popular for a long time, however they present a high risk to lenders due to the ever-changing nature of the tenants. There are many lenders who will offer loans, some high-street lenders offer the same rates as standard BTL for the right property, meaning the returns can be outstanding. Typically, these competitive deals are for properties with a low number of rooms, or where deposits are higher, so be sure to give us a call so we can advise on what to look out for. Where a property is larger in size, or where licensing is required the lenders get more expensive, and the criteria more complex. Often the proposition is looked at like a commercial venture, not only ticking off criteria, but weighing up the experience of the client, the area and demand for this kind of housing, and the structure of the property as well. Being of such a variable nature we recommend you discuss every property with us so we can ensure its going to be acceptable to lenders.
Bridging finance is an essential part of the lending market, whilst expensive, it provides an essential tool to getting deals done. Essentially a short-term mortgage, secured against a property that’s likely to be sold at some point.
Bridging is available for BTL, Commercial and Residential lending and the terms and rates are extremely flexible. Rates are generally agreed based on the proposition, and the main focus is on the exit, ie how the money will be repaid. The more equity available either at application or repayment, the better the terms generally.
The benefits of bridging include the ability to “roll up” interest, which means its added to the balance to repay, and the fact that it can be taken over a longer period, but if repaid early “unused” interest is refunded. The negatives usually involve costs, the rates are high, the fees are high and the disbursements are high.
When looking to finance the building of property there are many lenders that are active in this area. We would need to understand the proposed development, your assets and liabilities, experience in development and managing property and can recommend a lending partner accordingly.
Lending against commercial premises is complex and can be frustrating. We partner with one of the largest commercial brokers in the country, who have access and a deep understanding of over 200 commercial lenders. Often, we find that the boundary between specialist BTL and commercial overlaps and we can provide holistic advice across all types of lending. If the best option is a commercial loan, our specialist partners ensure you get the very best advice if that’s the right choice.
Multi Units on one freehold.
Often you come across property where the freehold is actually split into a number of self-contained flats. Most BTL lenders will not allow this type of property but we have access to a number who will. Speak to us about options available to you.
Your property may be repossessed if you do not keep up repayments on your mortgage.