The professional landlord: complex Buy-to-Let

Buy to let

There has been a lot of talk about the so-called ‘professionalisation’ of Buy-to-Let since the former Chancellor George Osborne confirmed a stamp duty hike for landlords, tapering of tax relief and the removal of the wear and tear relief.

Much speculation has been made around putting a portfolio of properties into a limited company to benefit from lower tax rates. This is something we are seeing more of at Vantage

Earlier this year Vantage Finance received a referral from a bank to help one such landlord. His firm was looking to purchase 28 properties from the partners’ personal name to incorporate into a professional partnership. The properties were predominantly in the south east and east of London, requiring a total loan just shy of £8 million.

His need didn’t stop there. He already had another 28 properties and, in a bid to regroup his portfolio, was looking either to do a product switch or capital raise in various ways across these properties with the total finance required on these hitting £9.12 million. (14 product switches totaling £5.28m and 14 regroup/refinances totaling £3.83m)

To add to the pressure, he imposed a timeframe of three months on Vantage, Vantage spent days working through different scenarios to put to the client to form part of its recommendation. The amount of paperwork required given the loans were arranged through multiple facilities required a member of the Vantage team to apply such focus to the transaction daily to ensure it went through as efficiently as possible.

Lucy Hodge, director of Vantage Finance, said: “Deals at £17 million don’t come along that often and when they do, they’re usually not straightforward. Securing the finance for this client was no different – we assessed his entire portfolio and finance needs and spoke to a lender we knew would have an appetite to fund the deal.

‘This is where understanding the client’s ultimate needs and the lenders’ various appetites for risk is invaluable and it’s the reason distributors who sit between brokers and specialist lenders can make or break a deal being done.

‘We completed this in the time the client required and following detailed conversations with the lender; they agreed to go outside their usual criteria in order to lend both on product and exposure limits.”

Loan amount: £17,078,682.00

Rate: between 3.66% and 3.92%

Overall loan to value: 65%

Find out more about complex Buy-to-Let mortgages