Buy to let purchase via Special Purpose Vehicle (SPV)

THE SCENARIO

A client was recently referred to Enness looking finance a buy to let purchase in Bath. The client and her husband each owned 50% of a property development company – sharing a large buy to let property portfolio, all of which was owned via an SPV. My client wished for the buy to let purchase to be completed via the SPV as well.

Property developers and investors typically use SPVs to contain and manage risks associated with their developments, each of which will have different investor profiles.

My client’s main residence was owned in her husband’s name; with whom she develops properties and as such has no personal property footprint in the property market. My client wanted to purchase the property with as little deposit as possible, borrowing £487,500 to purchase the £650,000 property, creating a challenge for lenders as most would not allow for such a small deposit. The fact the client also had no main residence and declared very little of her income posed a further challenge.

OUR SOLUTION

Thanks to Enness’ relationships with an extensive network of lenders, I was able to work with one who used a very low stress test, with no minimum income required. The particular lender offered a reduced rental calculation, meaning we were able to get a higher loan to value, with a small deposit. As a result, I was able to secure an interest only loan at a rate of 3.5% LIBOR over a 25-year term.

If you are considering purchasing buy to let property via an SPV, or have a portfolio in an SPV already, we have partnered with a specialist acquirer of property SPVs in order to extract profit and avoid the cost and risk associated with ongoing ownership. This specialist can release cash from your property SPV in 30 days, taking all risks on your behalf, delivering fast payment to shareholders, no ongoing liabilities, certainty in terms of outcome and an entirely private transaction.

If you would like to discuss how Enness’ partnership with an SPV specialist can benefit you, speak to one of our expert brokers today.

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