BTL mortgage case studies – my new weekly columnMake Text Bigger
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 🙂
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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