"Offset BTL Mortgages/commercial loans"
Discussion
Hey Guys,
I'm just wondering if a product such as this exists. Basically got a significant property portfolio which is very lightly geared at the moment - perhaps only about 10-15% loan outstanding on the combined (conservative) valuations of the properties. So, my thinking is that there will be a lot of opportunities in the near future where we could pick up decent deals if we complete really quickly and often in cash.
Is it possible for us to combine all of the outstanding mortgages/commercial loans together into one loan and for the bank to give us money to use so we can expand by buying more properties if and when we feel a good deal is available on the table. So basically, say for example I have a few properties worth £1m and the loan outstanding on these is £100, 000, would a bank beable to refinance these and give me an extra £400,000 (so that's 50% LTV) But I will only pay the interest IF I use the money to buy further property. I guess the advantages for this kind of arrangement would be it would be very quick in getting access to capital and would cut down on fees and would allow us to purchase as a "cash purchase." Basically I want a pot of money after refinancing the current loans, but only to pay intrest on this if and when I use the pot of money.
I doubt anything like this exists, but we're thinking of changing our bank and we have not really had dealings with other banks so don't really know what else is out there.
Hopefully that makes sense
I'm just wondering if a product such as this exists. Basically got a significant property portfolio which is very lightly geared at the moment - perhaps only about 10-15% loan outstanding on the combined (conservative) valuations of the properties. So, my thinking is that there will be a lot of opportunities in the near future where we could pick up decent deals if we complete really quickly and often in cash.
Is it possible for us to combine all of the outstanding mortgages/commercial loans together into one loan and for the bank to give us money to use so we can expand by buying more properties if and when we feel a good deal is available on the table. So basically, say for example I have a few properties worth £1m and the loan outstanding on these is £100, 000, would a bank beable to refinance these and give me an extra £400,000 (so that's 50% LTV) But I will only pay the interest IF I use the money to buy further property. I guess the advantages for this kind of arrangement would be it would be very quick in getting access to capital and would cut down on fees and would allow us to purchase as a "cash purchase." Basically I want a pot of money after refinancing the current loans, but only to pay intrest on this if and when I use the pot of money.
I doubt anything like this exists, but we're thinking of changing our bank and we have not really had dealings with other banks so don't really know what else is out there.
Hopefully that makes sense
zuby84 said:
Hey Guys,
I'm just wondering if a product such as this exists. Basically got a significant property portfolio which is very lightly geared at the moment - perhaps only about 10-15% loan outstanding on the combined (conservative) valuations of the properties. So, my thinking is that there will be a lot of opportunities in the near future where we could pick up decent deals if we complete really quickly and often in cash.
Is it possible for us to combine all of the outstanding mortgages/commercial loans together into one loan and for the bank to give us money to use so we can expand by buying more properties if and when we feel a good deal is available on the table. So basically, say for example I have a few properties worth £1m and the loan outstanding on these is £100, 000, would a bank beable to refinance these and give me an extra £400,000 (so that's 50% LTV) But I will only pay the interest IF I use the money to buy further property. I guess the advantages for this kind of arrangement would be it would be very quick in getting access to capital and would cut down on fees and would allow us to purchase as a "cash purchase." Basically I want a pot of money after refinancing the current loans, but only to pay intrest on this if and when I use the pot of money.
I doubt anything like this exists, but we're thinking of changing our bank and we have not really had dealings with other banks so don't really know what else is out there.
Hopefully that makes sense
It tried to do this a little while back. This sort of thing did exist before this recession but is now not really offered. Where it is the rates are extortionate with big fees too!I'm just wondering if a product such as this exists. Basically got a significant property portfolio which is very lightly geared at the moment - perhaps only about 10-15% loan outstanding on the combined (conservative) valuations of the properties. So, my thinking is that there will be a lot of opportunities in the near future where we could pick up decent deals if we complete really quickly and often in cash.
Is it possible for us to combine all of the outstanding mortgages/commercial loans together into one loan and for the bank to give us money to use so we can expand by buying more properties if and when we feel a good deal is available on the table. So basically, say for example I have a few properties worth £1m and the loan outstanding on these is £100, 000, would a bank beable to refinance these and give me an extra £400,000 (so that's 50% LTV) But I will only pay the interest IF I use the money to buy further property. I guess the advantages for this kind of arrangement would be it would be very quick in getting access to capital and would cut down on fees and would allow us to purchase as a "cash purchase." Basically I want a pot of money after refinancing the current loans, but only to pay intrest on this if and when I use the pot of money.
I doubt anything like this exists, but we're thinking of changing our bank and we have not really had dealings with other banks so don't really know what else is out there.
Hopefully that makes sense
I would approach your current lenders to ask for some further borrowing on your current loans. This should be much easier especially if you have several different lenders. Lenders are keen to keep hold of customers, especially good ones and so should be able to offer you something.
HTH
M
Nothing like that exists in the normal BTL market right now. Certainly there is no standard BTL Offset mortgage.
I'm not sure if one of the high street names might put a revolving facility together for you, but as SM says I the fees & rates would be horrific.
You might be better simply refinancing your BTL's on an "as needed" basis when you get to looking.
I'm not sure if one of the high street names might put a revolving facility together for you, but as SM says I the fees & rates would be horrific.
You might be better simply refinancing your BTL's on an "as needed" basis when you get to looking.
This facility is definitely available but I think it will be your "business / company" structure that will dictate the potential to borrow and the potential lenders.
We have this set up with Lloyds Commercial but ours is a Limited company with a proven trading history and also a very good relationship over 20+ yrs in a number of business sectors.
The key to the borrowing is not only the equity ratio although this is important, the key is repayment cover as this is what the banks risk department wants to know more than anything.
Be aware the bank will want everything valued and also copies of everything, Planning, AST's, Insurance, your accounts etc. If you have therefore just been running your portfolio as a sideline then you may need to reconsider.
Not sure that a residential lender would be willing or able to offer this facility for you?
We have this set up with Lloyds Commercial but ours is a Limited company with a proven trading history and also a very good relationship over 20+ yrs in a number of business sectors.
The key to the borrowing is not only the equity ratio although this is important, the key is repayment cover as this is what the banks risk department wants to know more than anything.
Be aware the bank will want everything valued and also copies of everything, Planning, AST's, Insurance, your accounts etc. If you have therefore just been running your portfolio as a sideline then you may need to reconsider.
Not sure that a residential lender would be willing or able to offer this facility for you?
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