Calling BTL mortgage experts

[GT03ROB]

We have a property rented out which has recently been valued for mortgage purposes at £185k. This property is currently unencumbered by any outstanding finance or mortgage. If we were to leverage this to build a small BTL portfolio what would be the best / achievable way of raising finance?

[Burgmeister]

Remortgage it.

[Sarnie]

GT03ROB said:

We have a property rented out which has recently been valued for mortgage purposes at £185k. This property is currently unencumbered by any outstanding finance or mortgage. If we were to leverage this to build a small BTL portfolio what would be the best / achievable way of raising finance?

The rent you are receiving will dictate how much you can borrow. If it's sufficient you can re-mortgage it up to 75% LTV and then turn those funds into 25% deposits for further property purchases, values dependant of course....

[slippery]

What sort of interest rates are available on BTL with 25 percent deposit these days?

[Sarnie]

slippery said:

What sort of interest rates are available on BTL with 25 percent deposit these days?

That's too broad a question.

Rates will depend on the sort of product you want and your circumstances.....

[slippery]

Sarnie said:

That's too broad a question.

Rates will depend on the sort of product you want and your circumstances.....

Apologies. Carry on.

[Sarnie]

slippery said:

Apologies. Carry on.

No need to apologise!

I'd just need a bit more detail to the product required to give you a specific answer eg a two year fixed rate and a five year fixed rate would be about 1.5% apart.....

[slippery]

Sarnie said:

No need to apologise!

I'd just need a bit more detail to the product required to give you a specific answer eg a two year fixed rate and a five year fixed rate would be about 1.5% apart.....

The question was more out of curiosity than a desire to do anything about it. I just wondered roughly what the rate was for interest only deals at the moment. Obviously fixed rates do appeal as they or more of a known quantity, but if anything, I can see the rates rising after the fixed period ends.

[Sarnie]

slippery said:

The question was more out of curiosity than a desire to do anything about it. I just wondered roughly what the rate was for interest only deals at the moment. Obviously fixed rates do appeal as they or more of a known quantity, but if anything, I can see the rates rising after the fixed period ends.

The rates aren't any different for Interest Only mortgages.....

[slippery]

It's been 7 years since I shopped for one, so that's why I'm ill informed.

[Sarnie]

slippery said:

It's been 7 years since I shopped for one, so that's why I'm ill informed.

If you were talking about residential mortgages the yes, the Interest Only sector is a royal pain in the arse nowadays. But BTL IO mortgages are still straight forward as BTL mortgages are unregulated loans...

[jonny70]

Sarnie said:

If you were talking about residential mortgages the yes, the Interest Only sector is a royal pain in the arse nowadays. But BTL IO mortgages are still straight forward as BTL mortgages are unregulated loans...

just curious is it hard to get a BTL on a property held within a limited company?

[Kudos]

jonny70 said:

just curious is it hard to get a BTL on a property held within a limited company?

Yes, that's why you should not buy via a ltd company (amongst other reasons)

[Sarnie]

jonny70 said:

just curious is it hard to get a BTL on a property held within a limited company?

Yes.

[z4chris99]

Sarnie said:

jonny70 said:

just curious is it hard to get a BTL on a property held within a limited company?

Yes.

no

just need bigger deposits.

[Sarnie]

z4chris99 said:

no

just need bigger deposits.

"Just"

[z4chris99]

Sarnie said:

"Just"

35/40%, I was offered 4% at 1.25x minium cover.

[Kudos]

z4chris99 said:

no

just need bigger deposits.

What is the structure of the ltd company e.g. Is it a property company? I presume OP is not and has/had some spare cash in his ltd company

[Sarnie]

z4chris99 said:

35/40%, I was offered 4% at 1.25x minium cover.

My point was that its not easy to "just" come up with a bigger deposit.

And 4% at 60% LTV isn't great.

[z4chris99]

Sarnie said:

My point was that its not easy to "just" come up with a bigger deposit.

And 4% at 60% LTV isn't great.

no its not.