Summary: Two business partners with a joint portfolio of over 20 buy to let properties, looking to raise capital on a recently refurbished HMO.
The capital raised would be used to repay the loan taken out to fund the refurbishment works. The pair were also hoping they would be able to raise enough to invest in a further buy to let property.
Both applicants receive a low income – one earning less than £25k pa (solely from rental income), the other receives a pension of £15k in addition to rent from his properties.
✔ No minimum income
Many lenders impose a minimum of £25k pa
✔ Rent as income
Some lenders prefer landlords to earn income in addition to the rent
✔ HMOs up to 8-beds
Many lenders will only go up to 5-beds
✔ Ex-Local Authority properties
Not a lot of lenders will accept ex-council properties
Broker proc fee: £2,888 (0.7% of loan amount)
Property value: £550,000
Loan amount: £412,500
Rate: 4.19% 5 year fixed
RTI: 145% @ 4.19%
Term: 14 years interest only
Lender arrangement fee: 2% (£8,250)