Securing terms for a divorcing couple turning their former marital home into a buy to let

THE SCENARIO

For the last 18 months, I have developed a very strong relationship with a client couple. In this time, I have completed 10 mortgage cases for them, and they continue to use my service to build their expanding property portfolio. They now own 34 buy-to-let properties that provide them substantial rental income.

The couple, who run a successful design company based in Chelsea, recently separated. However, they continue to be business partners for the sake of maintaining their property portfolio and their design business.

They planned to leave their marital home and turn it into rented accommodation, splitting the rental revenue between them and using the capital raised to fund future property purchases. The property in question was a beautiful 5-bed in Chelsea valued at £3.65million and was in impeccable condition due to their flair for interior design.

Matters became complex as most lenders would treat this case as a let-to-buy because the couple were converting their previous residential property into a buy-to-let. This meant that the lenders were unable to consider this as a straightforward buy-to-let transaction.

Add to this the fact that their income from their vast property portfolio was just shy of the amount that most lenders would require in order to produce terms for borrowing over £1million; this left us several hurdles to cross to acquire their desired outcome.

OUR SOLUTION

At Enness we have access to over 300 lenders around the globe. Some thoughtful research led me to a lender that we regularly work with who was able to offer my clients the maximum amount of borrowing based on the potential rental income of their former residence. This allowed my clients to capital raise in order to increase their property portfolio in the future.

The lender was able to offer the full desired amount of £2.1million which released £1.31million for the clients to use. The lender was comfortable doing this because my clients were clearly very experienced landlords and we were able to prove their capability for repayment.

I managed to acquire my clients a rate of 3.79% fixed for 5 years within an interest only 25-year term. This suited my clients perfectly and allowed them the flexibility they needed to continue their business ventures while leading separate lives.

It is of great importance to Enness, and myself personally, to maintain these strong relationships, and our return rate of clients is something we are incredibly proud of. I hope to work with these clients again in the future.