Company director remortgage and capital raise on one of his existing flats

THE SCENARIO

I was recently contacted by an expat living and working in Hong Kong. He had come across Enness’ prominent online presence, and wanted an expat remortgage for five of his buy to let flats in order to purchase further rental properties.

My client was an experienced investor and had sourced some rates for himself, but wanted to see if Enness could structure more favourable terms against his buy to let portfolio. The flats were worth a total of £1.5million, and located in East and West London.

This gentleman wanted to add further buy to let flats to his portfolio, but needed to remortgage his current properties to raise a deposit. In order to complete the purchase, my client needed to raise a total of £325,000.

An immediate difficulty was presented in that my client’s properties were owned in his personal name, meaning he was subject to less favourable buy to let stress testing, making it very difficult for me to secure the maximum loan size. Furthermore, my client wanted to secure borrowing as soon as possible to partially fund future buy to let acquisitions, some of which were new builds. These new build properties were nowhere near finished, meaning completion could not be simultaneous.

I managed to negotiate so the lender considered the aggregate lending rather than individual loan sizes. This meant more attractive overall pricing and a larger loan size at 75% loan to value (LTV), which is very rare with expat remortgage buy to let lenders. Further, I was able to arrange completion before the future buy to lets were ready so my client secured a competitive rate, with the certainty that he will have the funds in place for the new purchases, including a potential auction purchase where upfront cash is key.

The bank with whom I negotiated this favourable deal with was an international lender whose underwriting primarily is based upon the asset. This meant the overall debt relative to earned income was significant, but acceptable given that the properties are all rented by tenants.

The rate offered for this complex case was a favourable 4.24% 5-year fixed over a 25-year term, securing my client a successful expat remortgage to expand his buy to let portfolio.

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