Almas Uddin
Founder and Mortgage Advisor
07 Apr 2021
Client Background: Revolution Brokers was approached by a private landlord looking to remortgage a property to raise capital. The client had sufficient equity in the property to meet standard LTV rates but been rejected for lending due to adverse credit issues.
Property Information: The property was a standalone rental home in Middlesex, of standard construction and offering a viable rental cover to provide a profit after paying interest-only mortgage costs, so it didn't pose any problems in terms of affordability or security.
In this case, the challenge was that the client had a CCJ on their credit file, registered just over three years ago. This resulted in their BTL remortgage applications being rejected.
Financial Requirements: Our client was looking for an LTV ratio of around 74% - other lenders had rejected an application for a 74-75% buy to let remortgage based on credit assessments rather than affordability.
The buyer required a BTL remortgage to the value of £193,000 at an affordable interest rate and to move relatively quickly to proceed with their other portfolio plans.
The Revolution Brokers Solution:
The Revolution Brokers team consulted with our client to gain a more comprehensive understanding of their experience as a landlord, the profitability available from the property in question, why they needed to release equity and the background of the credit issues that had posed such a problem to finding remortgage lending.
While the CCJ had been registered just outside three years ago, we established that this had since been satisfied and all debts settled. The credit file reported no further credit issues in the last three years.
Having negotiated with our recommended lender and shown that the landlord was a secure, experienced borrower and had been in good financial standing for the last three years, Revolution secured a BTL remortgage for the total value required.
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Property Valuation:
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£260,810
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Total Mortgage Borrowing:
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£193,000
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Loan to Value Ratio:
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74% BTL remortgage
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Negotiated Interest Rate:
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3.74%
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Mortgage Term:
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25-year standard term
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Monthly Payment Value:
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£611 interest-only
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Arrangement Costs:
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£2,898 fixed cost
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Rental Income Achieved:
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£1,125 per month
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