Key Figures:
- Client: British National & Resident
- Property type: BTL Property in London
- Property Value: £8,500,000
- Loan Amount: £5,950,000
- LTV: 70%
- Amortisation: 60%
- Margin: 2.8% above BBR
- Term: 5 years
We were recently approached by a high-profile international business owner, entrepreneur and philanthropist who was looking to purchase a BTL (buy-to-let) property in London worth £8.5 million. The client was an active investor in a number of businesses, notably across technology and consumer products. As such, the client required the property to be purchased through a company they owned.
In the past, many individuals would own buy-to-let properties in their own name, potentially working with management or leasing companies to support them with day-to-day operations as required. However, with the end of the rules that allowed individuals to fully deduct mortgage interest from rental income, many investors are assessing how they hold property, especially if you have two or more rental properties. While individuals (or couples) can’t deduct mortgage income any longer, the rules are different for companies, and mortgage interest will still be classified as a cost when looking at company expenses and profitability.
While owning property through a company will give you a tax break, additional charges are associated with running a company, such as accountants, corporation tax, etc. As a result, corporate structures tend to be more beneficial if you have a more significant buy-to-let investment portfolio. Thinking carefully about what ownership structure makes the most sense for you is essential.
As this case illustrates, there is no one-size-fits-all when it comes to million-pound-plus buy-to-let mortgages. Here, we successfully met the client's requirements by arranging a 70% LTV (loan-to-value) mortgage with a corporate ownership structure. You’ll find that personalised finance packages are most advantageous, and you’ll want to benefit from a solution that’s tailored to your income, assets and overall circumstances.
With access to more than 500 lenders, Enness has the contacts and experience to help you secure the optimum buy-to-let finance structure and negotiate the very best lending rates and terms available. Working alongside you as a trusted partner, Enness understands which of your assets and income streams to showcase to lenders, how to increase lenders’ comfort and how to reduce your financial charges wherever possible.
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