Floating Charge on LTD company mortgageMake Text Bigger
This is more a ‘watch out for’ rather than a question, having said that if anyone has a fix I would truly appreciate it!
In brief, I set out to purchase two buy to lets within a limited company that currently has one buy to let with a Kent Reliance mortgage. We decided on Paragon mortgages for both new properties. They have a floating charge clause which means they have a charge against all company assets. My trusted financial advisor spoke to Kent Reliance and they said its fine, they get them all the time, there should be no problem in allowing the floating charge. (Verbally) We are now ready to exchange on both properties having spent three months in the conveyancing process etc. Kent Reliance has now been formally approached to allow the floating charge, and they have refused it.
Yes we are pushing back, but it seems unlikely we will overturn the decision. Clearly I am in talks with my F.A. about how we have ended up in this position having spent thousands in solicitor’s fees and mortgage application fees. In hindsight, I would have held off starting the conveyancing process until my solicitor had checked the mortgage offer, but in reality no seller would have taken me seriously. One to be aware of in this new world of Ltd Company buy to let.
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