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Landlord earning less than £20k pa remortgages to consolidate debts of £60k pa

Landlord earning less than £20k pa remortgages to consolidate debts of £60k pa

We were approached by a broker who was having trouble sourcing finance for a client to pay off £60k of overdraft and credit card debts.

The client is a full-time landlord with three rental properties which provide her with an average income of £19.5k. The property she was hoping to remortgage is a 3-bed house in Slough which generates £1,300 per month in rent.


The broker brought the case to Keystone because we do not credit score and we take manual approach to underwriting.


When reviewing the application, it was clear that the client would be easily able to meet the monthly mortgage payments and so the following terms were offered and accepted.


Property value
: £380,000

Loan amount: £285,000


LTV
: 72%


Rate
: 3.99% 5 year fixed


Product
: Classic Range


Term
: 20 years’ interest only


Borrower
: Individual


Mortgage payment
: £963 pcm


Original mortgage
: £594 pcm on £170,100 loan


Lender arrangement fee
: 2% added to the loan (£5,700)


Rental income
: £1,300 pcm


Gross yield
: 4.1% pa


Broker proc fee
: 0.6% (£1,710)



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