Fair Rents (Scotland) Bill or Artificial state manipulation of free market rent?10:34 AM, 6th November 2020
About 4 weeks ago 36
Birmingham Midshires have just launched an interest only, five year fixed rate buy-to-let mortgage with an interest rate of just 1.95% for purchases or 1.97% for remortgages up to a maximum of 60% Loan to Value.
Low geared landlords will be rubbing their hands with glee!
Only yesterday I spoke to a landlord who owns £1,000,000 worth of properties with no mortgages secured against them. He plans to borrow £600,000 and have the product fees of £1,995 per mortgage added to the advance.
His monthly interest on the £600,000 will be just £985.
He then plans to buy another £1,000,000 worth of property in the name of his wife, using the money from above to fund deposits, purchase costs, furnishings and leave himself with a tidy amount to top up their liquidity fund.
Birmingham Midshires now provide up to five mortgages per individual, thus making this possible for the couple.
Another landlord I spoke to has just one property which is unencumbered and two others with just small mortgages at circa 30% LTV. His plan is to take these new mortgages and pay down other more expensive loans on other properties where there are no early repayment charges. He will not be borrowing any more money in total, but his cashflow will improve quite remarkably as a result of this remortgaging.
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