The following example, although hypothetical, is typical of the type of situation which many landlords face.
Jane is a landlord with three Buy to Let properties. She’s found another flat to purchase to add to her growing portfolio, but it needs updating before she can put it on the rental market. She plans to put in a new kitchen and bathroom to bring it up to scratch.
The Saffron Solution:
Our Buy-to-Let Light Refurbishment Mortgage is ideal for this situation.
Jane is provided with an initial advance of 75% of the property’s value in its pre-refurbished condition – in this example, £112,500.
We simply require evidence that Jane can afford the monthly mortgage repayments during the refurbishment period. When the work is completed, the property is revalued and we’ll release additional funds of up to 75% of the new value.
Jane’s Mortgage Looks Like this:
- Purchase price of property: £150,000
- Estimated end value: £180,000
- Total advance required 75% of end value: £135,000
- Initial advance 75% of current value: £112,500
- Retention until works completed: £22,500
- LTV: 75% of post refurbishment valuation
Our rental cover requirement is based on the rental assessment after the refurbishment work has been completed.
The Buy-to-let Light refurbishment mortgage is available for purchasing a property in need of refurbishment, or refurbishing an existing rental property.