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  • Buy-to-Let

    Loan to value rate insurance

    Hi

    I wonder if you can help with quite a specific question please.....

    I have a large portfolio of properties where I have remortgaged them all with one lender. Our mortgage terms state that we need to keep at 65% loan to value. In the event that prices drop and our LTV increases, we are in an exposed position. I have been searching and can't find an insurer or insurance products for this eventuality.

    Please can you let me know if you have got insurance of this kind to protect your loan to value position with your lender?

    Thank you

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    Unfortunately you won't find one (or if you do let me know). The UK property derivative market is still fairly bespoke and only large deal sizes.

    This is a common clause in many loan agreements. What you need to do is check whether its a MAC or MAE clause. In other words when does it trigger. Is it a quarterly test on only when there is a reason to test LTV's?

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    Tax advisor and mortgage broker

    stuart@johnsonsca.com

    02039077022

    Hi Stuart

    Thanks for your reply. I'll look into what you've said. I've got a lead from my mortgage broker and will come back to you if it works out.

    Thanks

    Catherine

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    "...large portfolio of properties where I have remortgaged them all with one lender"

    I think you're very lucky. I've always been told none of the lenders will lend on more than an absolute maximum of four properties.

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    Perhaps speak to a specialist Lloyds of London Insurance Broker who could have a policy bespoke built for you.

    Wouldn't be cheap though.

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