Source: http://web-archive-uk.com/uk/m/mortgagesforbusiness.co.uk/2016-02-16_7525551_36/Borrowing_through_a_newly_set_up_limited_company_Mortgages_for_Business/
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web-archive-uk.com: mortgagesforbusiness.co.uk - Borrowing through a newly set up limited company | Mortgages for Business
Borrowing through a newly set up limited company | Mortgages for Business
Mortgages Property Development Finance Bridging Short Term Finance Residential Mortgages About Meet the team Our approach Awards Testimonials Careers Contact us 0845 345 6788 Share News Insight Borrowing through a newly set up limited company 09 12 15 Written by Jeni Browne Jeni Browne head of residential and buy to let lending at Mortgages for Business answers one of the questions we are asked regularly at the moment Can I borrow through a newly set up limited company We are frequently asked at the moment and it s a very fair question Can I borrow through a new company and how is this possible as the company does not have any trading history so how do the lenders get comfortable with this When borrowing through a Ltd Co lenders will always ask that the Directors and or shareholders offer an unsupported personal guarantee more info on this below What this means is that these people are ultimately liable for the mortgage in the event of a repossession and thus the lenders are underwriting these people rather than the company Therefore as when taking a mortgage in your personal name they will credit score those offering the personal guarantee and these people will also need to meet the relevant criteria This is how lenders get comfortable with the company being brand new and not having any track record This then raises the question of whether when the company does have a track record a personal guarantee will still be required This is a yes for pretty much every lender There are some commercial lenders who may do a mortgage without a personal guarantee but these are generally on loan to values at sub 50 and on commercial terms So what is personal guarantee As stated previously when taking out a limited
Original URL path: http://mortgagesforbusiness.co.uk/news-insight/2015/december-2015/borrowing-through-a-newly-set-up-limited-company/ (2016-02-16)
are available to you when looking at transferring your buy to let property from personal to Ltd Co ownership Since the budget proposal I have seen a sharp increase in SPV and trading limited company applications from both existing and first time landlords with many of you asking me the same questions One of which being Should I purchase my next buy to let using either a trading limited company or an SPV a question I have answered in my recent blog Another popular question which is linked closely to this topic is Can my company buy my personal BTL property or Can I transfer the property into my own limited company SPV also known as a related transaction In short the answer is yes but the process is not the most straight forward due to variations in lender s requirements there are of course solutions As this is a subject which has been propelled into the spot light I have approached the SPV Ltd Co lenders to get an overall picture of the appetite in the market for related transactions Here s what I found out The good news is in general most lenders operating in company lending will consider these applications The common trend from lenders is the property must be purchased from the individual by the Limited company at full market value This means that stamp duty is payable if above threshold An area where lender s start to differ is around the deposit some lenders like to see that the deposit is available as if it was a normal property purchase i e savings in an account which satisfies standard money laundering requirements for deposit funds However a select few lenders allow the deposit to be gifted by the individual to the limited company most commonly
Original URL path: http://mortgagesforbusiness.co.uk/news-insight/2015/december-2015/transferring-your-btl-property-from-personal-to-ltd-co-ownership/ (2016-02-16)
Diary of a Buy to Let Purchase Part 4 – Call off the dogs… | Mortgages for Business
be completed Now to do this I need a bank account Let s gloss over this Today was frantic at work and I hardly had time to make a brew let alone give away what I have now built up in my head to be several hours of my day 2 That I confirm the name and address of the vendor For this I need the memorandum of sale from the estate agent Which they only produce once the vendor has supplied their solicitors details Which they still haven t done 3 To ask my accountant to confirm that I am the sole shareholder of the company and that the company will only be letting out property and not doing anything else An accountant Really This last one threw me into a blind panic I do not and have zero intentions of engaging an accountant I can do the company s annual return online myself just like I do a tax return so why on earth would I bother Cue hysterical email from me to the lender Thankfully they are decent people who have the ability be pragmatic and they have confirmed that if I send over the company M A this will be sufficient to satisfy these queries I certainly feel like I am dodging a financial bullet with these little extra potential costs that keep popping up Long may that continue Contingency property hunting So I am now in limbo with progressing my mortgage application as I have to wait for the vendor to get around to sorting out a solicitor Which takes all of three minutes so who can blame him for taking FOREVER to get this done Actually a nasty thought occurred to me as I was hoovering the stairs earlier on I never promised you glamour in this blog What if the vendor is not going to sell the property Or worse still be the slowest vendor known to man so much so that I miss the end of March deadline and end up with an extra 6k of stamp duty to pay To be frank if it s the latter he can sing for it But it would be nice to know now so I can start looking for something else So jobs for tomorrow Hassle the estate agent hunter becomes the hunted Have a look at what has come up for sale in the last week just in case Think about setting up a bank account Diary of a Buy to Let Purchase 2 12 2015 Part 1 It was that or a Range Rover 4 12 2015 Part 2 I ve made 800 already and I haven t got the mortgage yet 7 12 2015 Part 3 The demise of Nathaniel Pig 8 12 2015 Part 5 bank account 17 12 2015 Part 6 Business bank account interview or Center Parcs 21 12 2015 Part 7 Reality bites 29 12 2015 Part 8 The method behind the madness 12 01 2016 Part
Original URL path: http://mortgagesforbusiness.co.uk/news-insight/2015/december-2015/diary-of-a-buy-to-let-purchase-part-4-call-off-the-dogs/ (2016-02-16)
6788 Share News Insight Average buyer 4 500 better off under new stamp duty structure 07 12 15 Written by Jenny Barrett Most home buyers are benefiting from the new structure of stamp duty that was introduced this time last year analysis shows New research from the Halifax reveals that since the tax was converted from a slab to progressive structure last year homebuyers have typically saved 4 500 in stamp duty Halifax based its calculation on the average house price in England and Wales of 273 531 and highlights that under the previous stamp duty calculation buyers would have paid 8 205 Now the cost has now dropped to 3 676 buyers are making a saving 4 529 Under the new stamp duty structure only buyers spending more that 938 000 on homes are worse off As a result the top end of the market appears to have slowed During the first half of 2015 sales above 925 000 dropped by 10 compared to the same period in 2014 London has shouldered the burden of stamp duty While buyers in the capital are responsible for 13 of all property transactions they contributed 40 of all stamp duty revenues in 2014 15 Craig McKinlay mortgages director at Halifax said The changes made to stamp duty a year ago have been of significant benefit to many buyers Only those purchasing the most expensive homes are worse off There is some evidence that the top end of the market has been adversely affected by the changes with sales over 1 5 million falling by twice as much as the market as a whole The failure to index the start point for stamp duty in line with house price inflation has dragged more buyers into the tax net in recent years Buyers in
Original URL path: http://mortgagesforbusiness.co.uk/news-insight/2015/december-2015/average-buyer-4-500-better-off-under-new-stamp-duty-structure/ (2016-02-16)
Diary of a Buy to Let Purchase Part 3 – The demise of Nathaniel Pig | Mortgages for Business
piggy money boxes which apparently now are worth a fortune Alas owing to my inability to save money I never made it past Nathaniel Because I am now a company director and soon to be property tycoon and thus financially savvy I felt I would invest a little time researching into which bank is going to give me the best deal by this I mean welcome gift If they were doing money boxes 30 years ago perhaps now one could expect to receive I don t know an iPad or something So I felt it would be worth doing a bit of research to see what I can snaffle Well that was an eye opener When it comes to a business bank account which I need for my limited company the worm has done a U turn of gargantuan proportions You get charged for EVERYTHING Direct debits writing a cheque breathing Oh and my personal favourite 0 5 charge on cash paid in or taken out Hell you have to pay for the privilege of having the damn thing even if it s sat there doing nothing And AND no welcome gift Rubbish So I have had a look at moneysupermarket com and moneysavingexpert com and aside from being bored senseless I am genuinely confused with who charges what and when So I have reverted back to doing what I do best justifying my laziness On the basis that transactions through my account should be minimal rent in mortgage payment out Oh Ho Ho Ho Like it s going to be THAT simple the transaction fees are going to be nominal and so it s not actually going to make much difference who I go with And there just so happens to be a NatWest branch in spitting distance from the office and you can register online so it s the path of least resistance for me I think that s enough business bank stuff for now I will register the account tomorrow Sound familiar In other news I have just found out that the vendor hasn t yet provided the selling agent with solicitors details Why Because they haven t yet appointed a solicitor Brilliant We have until 31st March Mr Vendor and you have spent the whole of the last week doing NOTHING taps toe Mortgage update due tomorrow I may need to find myself a mortgage broker Diary of a Buy to Let Purchase 2 12 2015 Part 1 It was that or a Range Rover 4 12 2015 Part 2 I ve made 800 already and I haven t got the mortgage yet 7 12 2015 Part 4 Call off the dogs 8 12 2015 Part 5 bank account 17 12 2015 Part 6 Business bank account interview or Center Parcs 21 12 2015 Part 7 Reality bites 29 12 2015 Part 8 The method behind the madness 12 01 2016 Part 9 Join me in a buy to let fist pump 25 01 2016 Part
Original URL path: http://mortgagesforbusiness.co.uk/news-insight/2015/december-2015/diary-of-a-buy-to-let-purchase-part-3-the-demise-of-nathaniel-pig/ (2016-02-16)
Ask Paul: Why does pricing differ between limited company and personal rates? | Mortgages for Business
Let Mortgage Product Index Buy to Let Mortgage Costs Index Limited Company Buy to Let Index Property Investor Survey Money Markets FAQs FirstRate MFB TV Helping brokers with Buy to let mortgages Commercial mortgages Property development finance Bridging short term finance Case processing BrokerBusiness Case Studies Consulting Buy to Let Lending Mortgage Flow Published Research News Insight Buy to let mortgages Commercial Mortgages Property Development Finance Bridging Short Term Finance Residential Mortgages About Meet the team Our approach Awards Testimonials Careers Contact us 0845 345 6788 Share News Insight Ask Paul Why does pricing differ between limited company and personal rates 04 12 15 Written by Paul Martins Paul Martins consultant mortgage broker at Mortgages for Business answers one of our most frequently asked questions at the moment With many of you looking at transferring your property portfolios from a personal name to a limited company it is no surprise that one of our most frequently asked questions at the moment is why does the pricing differ between the two Let me explain 1 Competition Competition amongst the buy to let lenders offering rates in a personal name is far greater At present 04 12 2015 there are currently 976 products available to individual applicants and 114 to limited companies With more products comes more competition so lenders lower their rates to fight for business Only nine of the mainstream buy to let lenders are currently offering limited company rates 2 Underwriting Limited company applications are often classed as specialist lending meaning there is more involved with the underwriting process This means that rates and arrangement fees tend to be higher It really is as simple as that I do believe limited company pricing will start to come down in the near future however due to the complexity of the
Original URL path: http://mortgagesforbusiness.co.uk/news-insight/2015/december-2015/ask-paul-why-does-pricing-differ-between-limited-company-and-personal-rates/ (2016-02-16)
Diary of a Buy to Let Purchase Part 2 – I've made £800 already and I haven't got the mortgage yet | Mortgages for Business
reminds me that this would be a good time to write my list to Santa Anyway instead of submitting my application online to Kent Reliance I set about filling out an application form again the thought of it is much worse than actually doing it took 15 minutes tops which I have duly sent over to Paragon together with my supporting documents Waiting 48 hours for a mortgage offer Now this is the thing with mortgages after all this excitement I now have to wait to hear whether they are going to accept my application I think I would classify this as the nail biting point of the process And it could be middle of next week before I hear The tension is palpable And the estate agent is already chasing me to find out when they will get a call to get the valuation booked in Dear God it s been less than 48 hours give me a bloody chance What type of mortgage This is probably the time to mention the mortgage product I have chosen Now I initially thought I wanted a five year fixed rate to cover me for when rates go up as a company we are very for longer term fixed rates for all the obvious reasons BUT this is my first buy to let and there is a possibility that it won t be all it cracked up to be and five years is a very long time to commit to something you may end up hating I then swung to a two year fixed but two years just goes so fast and when this rate finishes there is a chance we still be mid rate increases so I may end up with a terrible rate assuming I am actually loving being a landlord and don t want to ditch it So I have opted for a three year fixed which feels like a good middle ground I am a Libran hedging my bets is what I do Whilst I have applied for the mortgage on this rate I have the ability to change this later without any costs as long as this is before the mortgage goes to offer so given that I seem to swing like a pendulum I may change this But for now I am happy that I have made the right decision Engaging a solicitor again I also formally engaged my solicitor today Thomson Snell and Passmore in Tunbridge Wells in case you are interested We often get asked about solicitors I love this firm and they are well versed in dealing with transactions for limited companies so for me they were the perfect choice Still nearly setting up a business bank account As you can see today was extremely productive however with all this going on I didn t get round to sorting out the bank account whoops so I will try and do this over the weekend Which I blatantly won t do as we are
Original URL path: http://mortgagesforbusiness.co.uk/news-insight/2015/december-2015/diary-of-a-buy-to-let-purchase-part-2-ive-made-800-already-and-i-havent-got-the-mortgage-yet/ (2016-02-16)
Testimonials Careers Contact us 0845 345 6788 Share News Insight October s figures show a 3 5pc rise in average deposits 04 12 15 Written by Gary McKenna The average deposit rose to 71 301 in October with an increase seen in nine out of ten regions across Great Britain According to the Mortgage Advice Bureau deposits were on average 0 9 higher than they were in September and 3 5 higher than they were a year ago East Anglia saw the largest increase where typical deposits rose 11 6 month on month from 46 504 to 51 877 Borrowers also are fronting more of their own money as house prices rise the research reveals The typical loan size in East Anglia dropped from 132 325 in September to 125 039 in October The largest deposits were seen in London with an increase of 5 2 recorded making the average deposit 179 248 The dedicated London Help to Buy scheme is predicted to give a boost to first time buyers in the capital who based on a 5 deposit of their own will be offered a loan of up to 40 of the value of a new build property interest free for five years Given that the average house price in London was 533 922 in October borrowers in the capital would therefore pay a deposit of 26 696 Brian Murphy Head of Lending at the Mortgage Advice Bureau said George Osborne s Autumn Statement hammered home the government s support for homeownership with several policies aiming to improve both the supply and affordability of homes This is sorely needed in the capital where house prices remain much higher than in the rest of the country and saving up for a deposit can seem an impossible task However with average
Original URL path: http://mortgagesforbusiness.co.uk/news-insight/2015/december-2015/october-s-figures-show-a-35-rise-in-average-deposits/ (2016-02-16)