HMO and Limited Company

BuytoLet

Overview

The Interest Coverage Ratio (ICR), which was previously calculated at 125%, has changed as a result of tax changes announced in July 2015 and underwriting guidelines recently issued by the PRA. This will have a material impact on the size of loan available to buy to let customers who do not use limited company status to raise mortgage funds. A bespoke ICR calculation reflects your customer’s tax position more accurately and could help them get the loan size they want. Use our Buy to Let calculator to see how much your customer could borrow.

Making it easier

NEW! We have recently launched our new Buy to Let Mortgage submission guide. This document has been designed to help provide a smooth application process for you and your customer. Click here to view the guide.

Highlights and features:

  • Maximum term of 35 years
  • Maximum age at application 80 years
  • 2 and 5 year fixed rate products

What you need to know:

Limited Companies

  • Rental cover - Assessment rate:
    • Higher of pay rate + 2%, or revert rate (minimum 5.50%) for shorter term Fixed and Tracker products.
    • Pay rate for 5 year + Fixed rates (additional underwriting may be required).
  • Minimum property value: £50,000 (excluding London and HMO properties)
  • Loan size: up to £3m to 60% LTV, £1m to 70% LTV, £750k to 75% LTV, £500k to 80% LTV
  • Portfolio: up to 20 properties (LTV limits apply) to a total value of £10m with Precise Mortgages, unlimited with other lenders
  • Maximum term: 35 years (maximum guarantor age at application 80 years)
  • Ownership: No limit on number of shareholders under the age of 25, subject to them being a director’s dependant. Newly formed SPVs accepted, as well as personal to Limited Company with equity gifts and capital raising
  • Credit history: adverse credit considered, refer to Limited Companies product guide for details
  • HMO: applications for HMO properties considered
  • Other products: Bridge to Limited Company also available

HMO properties

  • NEW: now available for Tier 2 customers
  • Experience: experienced landlords only. Applicants must have held a current buy to let for at least 12 months prior to application. No first time landlords
  • Maximum term: 35 years (maximum age at application 80 years)
  • Occupancy: properties with up to 8 bedrooms accepted
  • Loan size: up to £1m to 70% LTV, £750k to 75% LTV, £500k to 80% LTV
  • Minimum valuation: £250k in London, £100k elsewhere. Refer to HMO product guide for details
  • Portfolio: up to 20 properties (LTV limits apply) to a total value of £10m with Precise Mortgages, unlimited with other lenders
  • Rental cover - ICR: Bespoke ICRs based on individual circumstances to help you to maximise the loan size
  • Rental cover - Assessment rate:
    • Higher of pay rate + 2%, or revert rate (minimum 5.50%) for shorter term Fixed and Tracker products.
    • Pay rate for 5 year + Fixed rates (additional underwriting may be required).
  • Other products: Bridge to HMO also available

Bridge to Let

Bridge to let is an ideal solution for your customers who are property investors looking to complete their next project before renting out the property.

Key highlights include:

  • Reduce your customer’s fees with a 0% facility fee bridge.
  • Choose to apply for the buy to let mortgage at the same time as the bridge or post refurbishment works.
  • Withdraw capital on the completed project, allowing your customer to invest into their next project.

To find out more view the 0% facility fee bridging product guide, click here.

Packager Panel

Let our Packager Panel do the work for you.

You can submit a residential or buy to let mortgage to us direct or alternatively you can introduce a case to one of our packagers.

Contact one of our Packagers direct today.

LIBOR Trackers and the Reversion Rate

LIBOR Trackers and the reversion rate are variable rates that are linked to 3 month LIBOR and will change quarterly on 12 March, 12 June, 12 September, 12 December. Please note if this date falls on a non-working day then the LIBOR rate will be taken on the previous working day.

All of our LIBOR tracker products have a floor. This means that if LIBOR were to fall to 0.00% or less the rate payable will be 0.00% plus the agreed set percentage above LIBOR. This means that the rate payable will never go below 0.00% plus the additional percentage rate of the tracker mortgage.

For intermediary use only
BBR 0.50% / 3 month LIBOR 0.61%