BUY TO LET MORTGAGES & RE-MORTGAGES

Buy-to-let (BTL) mortgages are for landlords who buy property specifically to rent out. They are usually more expensive than normal mortgages, but they could help you become a property investor.

LIMITED COMPANY BUY TO LET MORTGAGES

A Limited Company Buy to Let Mortgage is a method of financing the purchase of a property landlords wish to let. Many borrowers choose to buy as a Company Buy to Let for various reasons including Savings on Tax, For the ease of selling a property and getting investors.

HMO (HOME OF MULTIPLE OCCUPATION) MORTGAGES

HMO mortgages are a specialist type of Buy to Let mortgage available where lenders will accept Houses in Multiple Occupation as acceptable lending security.

LET TO BUY MORTGAGES

Let to Buy Mortgages are available to those who want to let out the property they currently live in, so that they can purchase a new residential property.

FIRST TIME BUYER BUY TO LET MORTGAGES

Buy To Let Mortgages are also available to First Time Landlords to finance the purchase of a property for the purpose of letting.

SECOND CHARGE LOANS

Second charge loans use your property’s equity as security. In the hierarchy of repayment priority, they are behind your mortgage and ahead of any subsequent ‘charges’ like third charge loans. Your mortgage provider gets paid first, the company that provided you with the second charge loan gets paid second – hence the name. For instance, if you have a property worth £400,000 and you have a mortgage worth £200,000 then you have £200,000 equity.

COMMERCIAL MORTGAGES

Commercial mortgages are used to buy business premises or to buy an existing business in its entirety. Lenders generally require a deposit of around 25%-40% of the total value and mortgage terms can run for one year, up to 40 years. Obtaining a commercial mortgage is based on the businesses ability to make the repayments. You will also find that lenders will assess your business before quoting you an interest rate.

Looking at past performance, the current position and long term future plans of the business. The interest rate you will be quoted may be based on these factors and may be higher if the underwriter identifies higher risk in the proposal. You may need to provide a detailed business plan which demonstrates that you can make repayments, and a professional valuation will usually be required.

Typical examples of when a Commercial investment loan would apply would be shopping centres, Industrial Estates, Agricultural Land, Office Buildings and mixed use properties.

BRIDGING FINANCE LOANS

Bridging loans are a temporary short-term loan, intended to be used to ‘bridge’ a gap in finances when purchasing property. They are often used to purchase a property while waiting for the sale of another to complete. For example, a residential buyer may use a bridging loan to secure a deal on a preferred property while their existing home is sold. A bridge loan could also be used when buying a property at auction, where the deal would need to completed almost immediately. They can also be used when buying a property to renovate and sell on.

Bridging Loans are considered a specialist but flexible finance option and for this reason are often used for commercial property refinancing.

Because a Bridge Loan is only intended to bridge a gap in available finance they are typically provided at higher interest rates than longer-term mortgages. The term of the loan is typically 2-12 months but can range to a couple of years. During the agreed term the loan is secured against equity in the property.