I recently helped a couple secure a buy to let remortgage on their two properties in order to raise money on top of their existing mortgage, to put down as a deposit on their dream home.
My client’s had an ongoing residential purchase in London and needed to achieve a high loan to value (LTV) at 80% for the remortgage in order to raise enough to complete the purchase. This would allow the clients to buy their new home without contributing any of their own funds.
This undoubtedly came with a few challenges, as no buy to let lender will typically go above 75% LTV, especially due to the fact that the properties were not based in prime central London. The majority of lenders will cap out at 75% LTV when the gearing on a property is high in a market that isn’t particularly strong, because it is seen as greater risk with not as much equity in the property.
My client’s also needed a lender that would allow 90% for the ongoing residential purchase. This is usually straightforward if the loan amount is less than £500,000, yet my clients were looking to buy around the £1 million mark, which is almost unheard of – thus eliminating practically every lender.
If that wasn’t all, one of the clients was also changing jobs, adding further difficulty in the eyes of many lenders for such a high LTV.
Despite this, the client was not on probation and was able to attain a letter from her new employer confirming her salary, so the lender was able to take her income into consideration as necessary for a new purchase.
I managed to successfully raise the required loan amount without dipping into my client’s’ own funds, so they could purchase their dream home and keep hold of their existing buy to let properties. I achieved all of this with a rate across each mortgage of 3% to 3.5% – an excellent result for buy to lets with such a high LTV.