We were approached by a broker whose client, a portfolio landlord and director of a project management company, was looking to raise finance against one of his investment properties.
The property in question is an unencumbered 2-bed flat within a newly built, eight-storey block in Salford. The client had only purchased the flat five months ago via his trading limited company.
The company’s trading accounts had suffered in the past few months due to an unexpected expense, so the broker needed to find a lender which would take a common-sense approach to underwriting.
The broker approached Keystone for the following reasons:
After examining the client’s business accounts and property portfolio, Keystone decided to overlook the poor recent accounts, due the client’s strong rental income and reasoning behind the drop in profit and offered the following terms:
Property value: £175,000
Loan amount: £131,250
Rate: 3.99% 5 year fixed rate
Term: 25 years
Mortgage payment: £443.60 pcm
Lender arrangement fee: 2% added to the loan (£2625)
Rental income: £950 pcm
Gross yield: 6.5% pa
Broker proc fee: 0.6% (£788)