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Residential Investment – Case Study

Refinance of 9 House in Multiple Occupation (HMO) and 3 Buy to Let properties

Lender – InterBay Commercial

Client – Private Landlord

Loan Amount – £1,350,000

Interest Rate – 4.35% variable

Area – West Yorkshire

Experienced property investor who was looking to refinance a medium sized residential property portfolio consisting mainly of HMOs to repay the current lender, Yorkshire Bank, and to capital raise for further BTL acquisitions.

The requested loan amount of £1.350M was based on 75% LTV based on a recent valuation done for Yorkshire Bank (YB). The outstanding balance on the YB mortgage was £875K so there was potential to raise an additional £475K.

The client had just had these properties valued by YB by a valuer not on InterBay’s panel. However, for a fee of £250 InterBay will review the report and, if satisfactory, will lend against the valuation figure which they did on this occasion.

The valuation figure was £1.800M so InterBay lent 75% LTV on a 10 year interest only loan at a margin of 3.6% + Libor (minimum 0.75%).

The client was delighted to be able to refinance away from Yorkshire Bank on interest only terms at such a competitive rate whist also being able to raise £475K in additional capital with which he was able to expand his property investment portfolio.

Refinance of 36 Apartments (from a broken block of 97)

Lender – Secure Trust

Client – Limited Company

Loan Amount – £1,627,000

Interest Rate – 4.25% Fixed (5 years)

Area – North Lincolnshire

Experienced property development/investment company was looking to refinance 36 apartments mortgaged to the Yorkshire Bank. The debt had been bought out by Cerberus and the client needed to repay them prior to the expiry of the loan agreement.

The apartments were all on separate long leasehold titles. The clients had developed the property themselves in 2006 and had sold of a number of units over the years retaining 36 apartments as longer term investments.

Appetite for this deal in the market was limited owing to the size of the apartment block and its location (not in a major city).

We worked on this deal with a local firm of brokers and a deal was secured at 75% LTV against the block investment value of the apartments. Directors’ PGs were restricted to 10% of the loan amount. The deal completed in September 2017 with Cerberus now fully repaid.

The clients were delighted with the terms of the deal which was at a fixed Interest rate of 4.25% over 5 years with capital & interest repayment structure.

To find out how we can help you with a residential investment call us on 01423 524 559 or complete our contact form.

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