New EICR to cover any changes made by outgoing tenant?10:00 AM, 4th May 2021
About 2 weeks ago 95
In this article I will explain the fundamental difference between equity finance for buy to let landlords and traditional buy to let mortgages facilities.
Both are mortgages which are secured by a legal charge over a property.
Until recently, only traditional buy to let mortgage finance where interest or interest and capital are repaid monthly have been available. This type of finance is usually secured by a first legal charge over the property, also known as a mortgage.
Equity finance has tended only to be available to blue chip companies but that’s all changing. It’s now possible for landlords to secure equity finance on their buy to let property portfolio or even their own home and without even having to remortgage.
Equity finance doesn’t attract interest at all. In fact, there are no monthly payments whatsoever. Instead, the lender takes a stake in the capital appreciation of the property, typically at the end of the loan term or when the property is sold or refinanced. Additionally, equity finance can be secured by either a first or a second legal charge, hence it can be used as top up finance.
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