"Landlords, even first timers, can invest in a property requiring light refurbishment, with the peace of mind in know they have cost-effective ongoing finance in place"
Lenders are reacting to this demand with new products and over the last year the number of available options for refurb has increased considerably. The most recent product launch is the refurbishment buy-to-let mortgage from Precise, which combines a short-term refurbishment facility with a longer term buy-to-let exit, giving the investors the combined benefits of increasing a property’s capital value and achievable rental income through improvements and decoration along with the peace of mind in knowing they already have a long-term exit solution in place once the works are completed.
The facility is available for light refurbishment, where there is no change of use or requirement for planning permission and no repayments are required while the works are being carried out, which can help with cashflow. The buy-to-let ongoing mortgage offer is underwritten simultaneously and remains in place for six months, provided there are no changes and the property meets the expected value following refurbishment.
The product is ideal for properties that need work, such as boiler replacement, to meet minimum EPC ratings, properties purchased at auction that require light refurbishment to be acceptable for mortgage purposes, landlords choosing to refurbish in order to maximise the rental yield of their property, and properties bought under market valuation.
The facility is available up to 75% LTV, with rates from 0.49% per month and the subsequent buy-to-let mortgage is available up to 80% LTV, with rates from 2.89%. The solution sees a streamlined process through the simultaneous offer process and also uses one valuation report and one set of fees.
Effectively, this means that landlords, even first timers, can invest in a property requiring light refurbishment, with the peace of mind in know they have cost-effective ongoing finance in place from the outset, with as little as a 25% deposit.
It’s an excellent example of a product being developed to meet a customer need and it will no doubt encourage even more landlords to investigate the benefits of a refurb investment.
