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I'm new on here, so appologies if this has been covered before. I have a LTD company in Scotland. Looking for BTL mortgages for cheaper properties. Property values may range from £15 to £50K. Are there any lenders who will lend 15K on a £20 property, as an example? If so, who?
It would also be good to find one that can complete a mortgage within 30 days, for buying at auction.
Thanks in adavnce
I have spent an age researching this and finding no one.Worryingly I actually got a decision in principle letter confirming acceptance from HSBC then they realised they dont do under £50k. Several others didnt realise they didnt do this either so beware if you get an initial person saying they do. The only people I found were Together. They have higher interest rates around 6%.I personally didnt want to go with them when they seemed the only people doing it in case I ever wanted to change lenders. I have posted on here about this before somewhere I think. If I am wrong,no one will be happier than me to find someone else lending at these amounts.
Thanks for your response. 6% would work fine. The predicitive models ive created for this were based on 6% anyway. I'll look them up.
They say they can turn things round in 14 days and offer themselves as an auction specialist. I havent got personal experience of whether this is true. I am still toying with something similar so would welcome your feedback if you go ahead with them
Hi and welcome to the tribe.I am not aware of any lenders who would consider this. However, as I am not a mortgage broker, I have asked the team at PT Brokers to comment so that you get a definitive answer.What I can tell you is that anything up to £25K is considered unsecured lending and you should be able to get these kind of loans fairly easily if you have a reasonable salary and credit rating. They are available from High Street banks and other lenders who you will be able to find by putting "unsecured loan" into google.Also, buying at auction is largely the domain of cash buyers and those using bridging finance , not mortgages.Hope that helps for starters?
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Thanks for your response. I have computed various models and it needs to be a 75% LTV, interest only. Unsecured lending is usually over 5 years and yeild wouldn't cover it. Have you heard of buying a property cash and then securing the mortgage?
Yes, TMW do this via select Brokers, unless it's an HMO then a higher value applies
We have access to this, and also Together and a couple of other lenders who will lend on a £50k property in Scotland to a Ltd Company buyer.
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Re completing within 30 days - you need to be well positioned with deposit, ID, DIP, pre-auction valuation, etc etc all in hand to make sure that this works from your end too.
As specialist BTL brokers, we can assist with your strategy
re "Are there any lenders who will lend 15K on a £20 property, as an example? If so, who?" There is usually a reason why properties are as cheap as this, and traditional (and even specialist) BTL lenders would not want this on their books I'm afraid. Our Clients who have successfully bought such properties do so with 0% credit cards, or cash, or if necessary by releasing the required funds from other properties with eligible equity.
I am wondering the same question. You mention paying for the property on a credit card. But do property auctioneers accept credit card as payment? Sounds crazy if so.
Surely they will add another 5% on top if they do?
Although there are quite a few BTL lenders many do not have any ability to lend in Scotland. So that reduces the options. Added to that not all will do BTL mortgages for Limited Companies which is another reduction in options. Finally many have a minimum loan size of say £25k-£30k so to get down to £15k you are probably looking at only a few lenders – in fact after some brief research I could only find Together at that level.
In fact if you can get a higher purchase price then Kensington, Aldermore, The Mortgage Works and Precise all come into play at the £25k-£30k mark. With regards to the 30 day completion aspect that is difficult to say as only TMW have the ‘high street’ processing speed to potentially complete in 30 days. Most advisers want a couple of weeks prior to the actual auction to get an offer released in advance to enable swift exchange and then completion well within the typical deadlines so to embark on a mortgage application after a property is secured at auction does have risks. That does not mean you cannot do what you seem to be looking for but you should have at least a Decision In Principle secured ready for a full application to be submitted the day after the auction to give you the best chances.
I hope this helps,
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