A Portfolio Finance (or Facility) is a single loan secured against a portfolio of residential properties. This is a valuable tool for buy to let landlords as it gives them the ability to expand their portfolios without having to search for new finance options each time they find a suitable property to buy.
Portfolio finance [BUY]
Why choose Smartlandlord®?
- Professional and efficient service
- Dedicated and helpful staff
- Access to a wide range of lenders
- Impartial advice
- Bespoke deals to suit your individual requirements
- Up to 75% Loan to Value (LTV)
- Arrangement fees of 1% to 1.5%
- Interest only for 3 - 25 years
- Available with an optional pre-approved 'Hunting Licence'
Q. Are Portfolio Finance / Facility rates fixed?
A. No. Portfolio Facilities are tailored to individual investors and are underwritten by lenders using the same process as a Commercial Investment Loan which is completely different to a Buy to Let Mortgage.
Q. What are the benefits of Portfolio Finance?
A. With Portfolio Finance a high yielding property can compensate for a low yielding property to unlock equity which has been trapped whilst an individual Buy to Let Mortgage has to be underwritten against the low yielding rental income.
Q. What is a 'Hunting Licence'?
A. A Hunting Licence is a pre-approved loan set at a pre-agreed loan to value covenant for the purpose of buying new residential investment properties.
Q. What is a 'Drawdown Facility'?
A. When a Portfolio Finance / Facility is set up if the existing mortgages are refinanced and replaced by one loan, the difference between the combined mortgages and the Loan to Value covenant is called the Drawdown Facility.
Houses in Multiple Occupation http://www.communities.gov.uk/housing/rentingandletting/privaterenting/housesmultiple/
Council of Mortgage Lenders http://www.cml.org.uk/cml/home
Tips and advice
Dos and Don'ts
- Keep details of all your existing financial arrangements to hand when applying for this service
- Keep a record of any financial applications made regardless of whether the loan has a drawdown
- Check for latest deals when you can redeem your existing arrangements
- Apply for this service if you do not have or do not intend to have a portfolio of properties
- Consider this facility if the Loan to Values are more than 85%
- Use this facility for buying through repossessions and auctions unless specifically agreed to by the lender
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