A very experienced residential and commercial landlord approached his broker for help in raising £275,000 to expand his portfolio. He was looking to refinance a storage facility which he owns outright. The facility which includes a warehouse, portable cabins and shipping containers is currently tenanted on a five-year lease to a construction company.
Realising that the high street lenders would be unlikely to offer terms because the landlord’s credit profile shows an historic County Court Judgment and a company that went into liquidation, the broker approached Keystone because it accepts:
The Keystone business development manager helped the broker and her client to complete the application form and compile the necessary documentation in support of the loan. This included proof that the client’s CCJ had been satisfied; details of the current lease; an accountant’s reference confirming the client’s income; and, site of his passport for identification purposes.
A date for the valuation was set within two weeks of the client receiving the loan facility letter and as anticipated, the ensuing report confirmed that the property was a good risk.
The following terms were offered:
Property value: £450,000
Loan amount: £275,000
Rate: 7.99% term tracker
Term: 10 years interest only
Mortgage payment: £1,900 pcm
Rental income: £3,666 pcm
Lender arrangement fee: 3% (£8,250)
Gross yield: 8% pa
Broker proc fee: 0.75% (£2,063)