The Basics of BTL Underwriting for Limited Companies
Mortgage lenders have basic requirements. They need to be satisfied with these to enable them to offer the mortgage. There are many misconceptions as to how in-depth these requirements are. For instance, some lenders are now lending to First Time Buyers. These people may also be First Time landlords. Previously, however, you needed to be a homeowner.
Trading Company
The vast majority of information in the press points landlords towards purchasing Buy to Let (BTL) properties in a Special Purpose Vehicle (SPV). However, there are other options. Importantly, moreover, for some, these should not be overlooked. It is correct that the SPV route will attract the most competitive rates. It can also be seen as the simplest route for a Limited Company purchase. A mortgage through your Trading Company may, however, work out as the most cost-effective for some people.
Setting up an SPV (Special Purpose Vehicle)
Most people are now aware of the rationale behind purchasing a Buy to Let property in an SPV or Special Purpose Vehicle. However, as I still get questions on this most days, it is worthwhile confirming what is expected from a lender’s perspective and the basics involved. The premise of this blog is not to confirm if a personal BTL or Company BTL is correct for you. It is to give the lenders expectations of what they require. Please bear in mind that this is after you have spoken with your accountant or sought tax advice. The result of this should be that a company structure is the way forward for your personal circumstances.
