Case outline:

An experienced landlord has been changing from personally owned properties to limited company owned properties over several years. One of his older properties was coming to the end of its mortgage term so he decided to have his limited company purchase the property from his personal name.

The large amount of equity held was to be used as the effective deposit. The client’s income is mostly drawn from his let properties as he had retired from employment some years previously. His net income totalled about £20,000 (including a small pension). He is 77 years old.

Property value: £400,000

Loan required: £150,000

Rental income: £2100 pcm

Loan-to-value: 37.5%

Solution provided:

We discussed the scenario with a number of lenders. The client’s low income was not a problem given his letting experience and substantial equity. Some lenders were offering specific portfolio products which had fee free incentives, minimising his up-front costs and keeping his mortgage balance down.

Product chosen:

3.39% 5 year fixed rate with no lender fee, no booking fee and a free valuation – portfolio product for limited companies.

Monthly payment: £423 pcm

If you would like to discuss options for limited company buy-to-let mortgages please phone our team of buy-to-let experts on 029 2069 1010