BTL mortgage case studies – my new weekly column
by Mark Edwards
I have been asked by Mark Alexander to put together a weekly column with examples of the enquiries I receive from Property118 readers and the solutions I have been able to offer them. Hope you find them inspiring 🙂Â
Case Study One
BTL investor for just over one year. Currently between jobs. Has owned five BTL’s since Jan last year (2014) and now wants to buy #6. No income proof. No earned income. Bank statements for last 12 months showing rents. Purchase price of new property £73,000, studio apartment of 440sq ft. Rental value £525 pcm. Studio apartment block is on the 4th floor of an 8 storeys block over commercial offices. Studio has a separate bathroom but kitchen diner part of lounge. Deal agreed in principle by lender at 80% LTV 3.99% fixed rate.
Case Study Two
Landlord for 2.5 years owns 7 properties. Wants to remortgage two of the properties at the end of April 2015. Property #1 is  a semi detached, 3 bed, value £170,000 with a mortgage outstanding of £94,180 with TMW. Rent £725 pcm. Property #2 is an end terrace, 3 bed, value £150,000 with a mortgage outstanding of £85,307, also with TMW. Rent £650pcm. Both property jointly owned between man/wife, one earning £10,000 a year and the other not working due to ill health. Own property owned outright, no credit problems. Remaining mortgages; 3 with TMW, 2 with BMS.  Rental income accounts show net profit of £8,700 each. Would like to raise some capital for further investment. Provided 2 quotes at 80% LTV. Quote 1) 3.83% 2 year tracker, loan £136,000, lenders arrangement fee of 2.5% added to advance, monthly interest £444.91. This raises £41,820 . Quote 2) 3.83% 2 year tracker, loan £120,000 lenders arrangement fee of 2.5% added to advance, monthly interest. This raises £34,693. Total net funds raised = £76,513 which assuming 15% deposits on further properties will enable new purchases to £510,000.
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14 flats with only 50 years remaining on lease
Member Since January 2011 - Comments: 12193 - Articles: 1396
5:35 PM, 20th February 2015, About 11 years ago
Hi Mark
This is indeed inspiring.
I’m guessing you’ve picked some of the more difficult cases to showcase here because I suspect a lot of our readers wouldn’t expect these to be doable.
The fact that you can place these cases tells me two things 1) that it isn’t as difficult to obtain funding as some people might think and 2) that you have some excellent contacts within the mortgage lenders based on many years of experience and trust in the quality of the performance of loans that you have presented to them in the past.
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