Doug Hall - Director - 3mc
Buy to let landlords have really had the squeeze put on their rental returns in recent years, which is why we’ve seen more of them turning to refurbishment buy to lets as a way to maximise their rental yields and increase capital value.
The problem landlords have traditionally faced is difficulty in securing finance to refurbish a property before letting it out. You don’t often see products coming together in the specialist lending market, so I love the fact that Precise Mortgages has been bold enough to bring Bridging Finance and Buy to Let Mortgages together in one Refurbishment Buy to Let package.
It’s a solution that we here at 3mc will really enjoy being able to offer our brokers and their customers – they’ve been crying out for something like this for a long time. We’re delighted it’s now available to 3mc and the wider market.
What we’ve been tending to find is that professional investors looking to buy property at below market value and wanting to improve it before renting it out have been funding the initial purchase in cash, doing the refurb work themselves and then remortgaging onto a standard buy to let product.
This new proposition ticks all the boxes for this investor profile. The beauty of it is that it gives surety for both brokers and their customers, as long as customers are confident they can complete any refurbishment work within the buy to let Offer validity period. Brokers can provide their customers with two Offers from the start, while customers get the peace of mind that an exit’s already in place and the price of the term product at exit is the price at application, regardless of what happens to the interest rate in the meantime.
It’s a game changer as it changes the cash flow model for purchase. Investors now only need to part with 25-30% cash, leaving the remainder in their pocket, rather than tied up in the purchase of the initial asset. What’s more, they can roll the interest up meaning there are no monthly payments during the refurbishment part of their loan and before the buy to let is generating rental income.
You can find out more about this great new offering by clicking here. Alternatively, you can contact your local Precise Mortgages’ Business Development Manager or call 0161 962 7800 to speak with a member of the 3mc team.