Remortgaging million pound B2L portfolio solutions are challenging to construct particularly when the portfolio is a large one! I recently assisted a professional landlord who was remortgaging his buy to let portfolio of 28 properties. The value of the portfolio was approximately £10 million (£5 million of which he had borrowed) and five of the mortgages were due to expire. My client was cumulatively remortgaging million pound B2L portfolio properties in order to capital raise and reduce his personal, residential mortgage.
This scenario was fairly complex due to the number of smaller, lower-value properties which made up the million pound buy to let portfolio. This was complicated as lenders don’t typically like to lend at this level of exposure when the portfolio is so dissected – in different areas and differing levels of investment in particular as it makes them feel uneasy. Furthermore, lenders generally have a maximum number of multi-million mortgages allowed with them due to the risk level.
When my client approached me his portfolio was divided between well-known high street lenders, meaning that I had to approach more niche lenders which were not readily available on the high-street. The properties were also rented out to students – some even had more than 5 tenants – which many lenders tend to stay away from.
I found one lender that took on five of these properties and they were happy to take on a debt of £1.5 million. They were also happy with the type of tenants to whom the properties were let out to as they met their criteria. They classed my client as an ‘experienced landlord’ which gave him the added advantage of an easier underwriting experience. They granted a 17 year mortgage term which took the client up to the age of 75.
The terms were finalised for remortgaging million pound portfolio in it’s entirety as a two year fixed rate of 3.39% and, in this particular case, the lender fee was low.