Buy to Let Remortgage
A buy to let remortgage process entails switching from your old mortgage deal to a new one, given that you meet all the required criteria. It is possible to either remortgage with your current lender, or switch to a new deal that has been offered by a different lender, depending on what is more beneficial to you. For help deciding, consult one of our Remortgage Solicitors who can guide you through the whole process.
The Buy to Let Remortgage Process
The remortgage process for a buy to let can be complex and difficult. Here at Starck Uberoi, we have expert solicitors who are ready to guide you through the whole journey. We will first ask for standard documents as well as the current rent the property is achieving. Having done this, we will proceed by assessing the current property against the rental income and the applicant’s tax status in order to achieve the loan amount that is required.
When it comes to buy to lets through a limited company, this niche area requires the correct legal advice and guidance, which we will be able to help you with. To get an idea of the possible fees involved, we have a free Online Conveyancing Quote Calculator that gives you an instant conveyancing quote.
Buy to Let Limited Company Remortgage
In the ever-changing world of investment properties, remortgaging a property stands out as a strategic instrument for limited companies to optimise their economic structure and to refine their financial framework. Unlike individual mortgages, limited company remortgages deal with properties held within a business entity. This distinction allows unique opportunities for property investors and we highlight below the benefits of remortgaging your property under a limited company and supplementary duties Starck Uberoi carries out for this nature of transaction.
You will need a solicitor to remortgage your property held in a limited company and we will be able to assist since we are on the panel of most limited company buy to let lenders including;
–MOLO
–The Nottingham Building Society
Remortgaging buy to let property into a limited company
When remortgaging a buy to let property, you can change the application from an individual basis to an application via a limited company of SPV (Special Purpose Vehicle). It is important to be aware that, when you remortgage a buy to let via a limited company, you are essentially selling that property to the limited company. This is because the legal entity that now owns the property has changed. A key implication of this is that Stamp Duty is payable.
Remortgaging a buy to let via a limited company is often the same process as any other buy to let remortgage. The only significant difference here is that, in this scenario, a company owns the property rather than an individual.
If you would like to remortgage a buy to let property into a limited company, you would need to transfer the property to a limited company. For more information about this, check out our Transferring a Property to a Limited Company.
Instant Conveyancing Quote
At Starck Uberoi we are committed to providing you with efficient and clear legal advice. We understand that finding a reliable conveyancer can be a time consuming and difficult task; to make it easier for you, we provide a free, online conveyancing quote calculator to save you time on your search.
What are the benefits in remortgaging a property under a limited company?
When remortgaging a property under your limited company , there are usually benefits that entail this process:
- Interest rates: The remortgage may allow the limited company to take advantage of better interest rates or financing terms which may reduce monthly payments or release equity for further investment.
- Investment: As above, remortgaging unlocks opportunities for the companies to release their equity and acquire additional funds to support property development projects, improve cash flow management, and enhance tax efficiency for the company and its shareholders.
- Portfolio Growth: There is always potential for portfolio growth. As a limited company expands, it can raise capital, acquire additional properties and allow more investment opportunities than individual owners through the remortgage process.
However, when acting for a limited company in a remortgage we ensure the necessary checks are done to ensure we comply with the necessary requirements as set out below:
- Company compliance – we always do additional checks to ensure the limited company complies with the legal requirements relating to the remortgage transaction. This includes verifying the legal status of the company and confirming the directors have provided their authority to act on behalf of the company (including any shareholders that may exist).
- Independent legal advice – many lenders require the directors of the limited company to obtain independent legal advice from an independent solicitor, that has no relation to the conveyancing transaction. This usually allows the solicitor to help the borrowers understand the risks associated with the mortgage which can include potential consequences of default non-payment.
- Company House Registration – once the remortgage has been completed, within 21 days of completion, the charge is required to be registered at Companies House. We thrive to complete this process as soon as the transaction has completed in order to minimise any delays the registration may occur.
Read our blog on the Buy to let limited company conveyancing process and for more general information of lender requirements on a buy to let property you may wish to read: Buy to let Conveyancing Solicitors
Buy to let in personal name
If you decide to invest property in your own name, you become personally liable for any debts or legal issues. You will also be subject to income tax and capital gains tax. Having a property in your personal name has its advantages and its disadvantages. It is important that you are aware of these before making a decision on whether you want to buy to let through a limited company or in your own personal name.
You will need a solicitor to remortgage your property held in a limited company and we will be able to assist since we are on the panel of most limited company buy to let lenders including;
–MOLO
Benefits and drawbacks of buy to let in personal name
Some of the benefits you gain while buying to let in a personal name are:
- Taking an income– If you want to take a regular income from the buy to let property, then investing as an individual is more likely to be tax efficient
- Preferable mortgage rates– Personal ownership typically attracts preferable mortgage rates and lower fees than through a limited company.
- Lower arrangement fees– Which can be paid up front or added to the mortgage
- Better investment– Buying a property in your personal name is more of a long-term strategy of making money through rental property. It gives you greater choice of buy to let mortgage rates, lower buy to let mortgage rates and lower lender arrangement fees
But, you should be aware of the potential drawbacks of buying a property in your personal name:
- Liability– Owning a property personally make you liable for any debts or legal issues
- Tax– You will be subject to personal income tax and capital gains tax. Rental income is subject to income tax, with higher-rate taxpayers facing rates of 40% to 45%. Capital Gains Tax would also be payable upon sale.
Should my buy to let property be owned in my personal name or through a limited company?
Deciding on what sort of buy to let you should do can have a big impact on your property. Unfortunately, there is no simple answer to this question. There are a number of factors that you would need to consider. Things like the number of properties you have, whether you need the income quickly and how long you want to hold the properties for can affect the decision you make.
For expert legal advice regarding this matter, get in touch with one of our Remortgage Solicitors to get a better understanding of what you should do.
Mortgage Lender Panels
Trusted Residential Conveyancing
We’re a six-partner practice accredited by the Law Society’s Conveyancing Quality Scheme (CQS) with £3 million professional indemnity insurance. Our quality service is recognised by our admission onto the residential conveyancing panels of major mortgage lenders, including bridging loan specialists.
Buy to let stress test
A buy to let stress test is essentially a financial assessment conducted by lenders to determine whether a potential borrower can afford mortgage repayments on a buy to let property or not. This test helps lenders mitigate risk and ensure that you are financially prepared for any possible fluctuations in the market.
How does a buy to let stress work?
Lenders will evaluate your rental income from the buy to let property. This is usually based on the expected rental income as determined by a surveyor’s assessment or the market rent for similar properties in the area.
Lenders apply the stress test by using higher interest rates than the current market rate. This is used to assess whether you can still afford the mortgage repayments if interest rates were to increase in the future.
Impact of this test
Failing the stress test can result in your lender approving a lower mortgage amount for you. This can alter the course of your remortgage application. It is thus key for you to get the right Remortgage Solicitor to advise you throughout.
Choosing Starck Uberoi Solicitors for your remortgage conveyancing is a decision backed by a wealth of advantages. Our commitment to streamlined and efficient conveyancing services ensures a hassle-free experience throughout the remortgaging process and is the reason we are on most lender panels. Use our Online Conveyancing Calculator for an instant remortgage conveyancing quote.
If you are looking for information on a private remortgage, you may want to visit our blog on ‘Do I need a solicitor to remortgage?’ (Hyperlink other blog here)
House in Multiple Occupation (HMO) Re-mortgage
Our specialist HMO conveyancing Solicitors can assist you with dealing with the re-mortgage of your HMO. The legal work will require promptly satisfying various conditions that your specialist lender will impose including reviewing your licence, planning permission and Tenancy agreements.
You may wish to read: House in Multiple Occupation (HMO) Conveyancing
Repayment of Help to Buy Loan by way of re-mortgage
If your property has increased in value over the last five years, our solicitors can assist you to remortgage your property and release equity from the property in order to pay off the government help to buy loan. Our Solicitors will liaise with both your new lender and whoever currently manage the loan repayment process.
You may wish to read: Help to Buy Repayment: A Quick Guide
FAQs
- How long does it take to remortgage a buy to let?
Remortgaging a buy to let can typically take 4 to 6 weeks, depending on your current lender service levels and timescales that they are working with. It is important to note that this timescale can differ, it all depends widely on your individual circumstances.
- Can I remortgage a buy to let when I live abroad?
Yes, it is possible for you to remortgage your buy to let property while you are overseas. However, a buy to let mortgage is harder to obtain if you are a UK expat. This is because lenders consider you a higher risk. It is not easy to prove your employment status, and foreign income is often not accepted as proof of earnings.
- How soon can you remortgage a buy to let?
Ideally, you should aim to remortgage your buy to let, or at least begin the process, 6 months before your initial rate period is due to end. The majority of lenders will allow you to secure a deal around 3-6 months before the intended start date of the new mortgage.
If mortgage interest rates are on the down, then it might be more beneficial for you to wait and hold out for a better deal closer to your renewal date. Likewise, if mortgage interest rates are on the up, then it would benefit you to secure a deal as soon as possible.
- Can I remortgage my buy to let to release equity?
Remortgaging a buy to let to release equity is very common. It is usually done to fund further investment or home developments, such as kitchen refurbishment, renovation or loft conversion.
It is often a key step in a landlords buy to let investment strategy. Thus, naturally, there would need to be equity in the property in order to do this.
You should be aware that you can remortgage your buy to let to release equity as long as the amount you plan to release does not exceed the maximum loan to value available on a buy to let mortgage.
- Can I change from residential mortgage to a buy to let mortgage
Yes. People can change their type of mortgage for various reasons. This can be done so that you can move in with your partner, or you’re buying a new home or simply keeping the current property as an investment. The process would be recognised as a remortgage.
- Is remortgaging necessary if I want to move into my buy to let?
You and your immediate family cannot live in a property that you own that has a standard buy to let mortgage.
If you would like to live in your buy to let property, you would need a residential mortgage and if you wanted to rent your property to your family, you would need to switch to it a regulated buy to let mortgage.
- Is it better to remortgage with my existing lender?
It is not necessarily better to remortgage with your existing lender. In fact, it is vital that you do your own thorough research to establish who you should remortgage your buy to let with. Your lender might give you preferential terms as an existing customer, but this might not always be the best deal available to you.
Through good research, you should compare all the deals you are getting across the buy to let market to see who can offer you the best guidance, cost effective deals and help.
If you are considering remortgaging your property, Starck Uberoi’s remortgage solicitors are here to guide you through the process. Whether you are seeking a better mortgage deal, planning home refurbishments, consolidating debts, or adjusting to changes in your financial circumstances, our experts can provide clear and practical advice to streamline the re-mortgaging process.
Choosing Starck Uberoi Solicitors for your remortgage conveyancing is a decision backed by a wealth of advantages. Our commitment to streamlined and efficient conveyancing services ensures a hassle-free experience throughout the remortgaging process and is the reason we are on most lender panels. Use our Online Conveyancing Calculator for an instant remortgage conveyancing quote.
- What sort of costs are involved and do you pay Stamp Duty when remortgaging to buy to let?
When it comes to remortgaging, you cannot pay Stamp Duty twice throughout the mortgage term. You only pay it when you buy the property initially.
However, there are other costs involved that you should be aware of. The costs include things like a valuation fee, product fee and conveyancing fees. But, typically, when it comes to remortgaging, there are lots of benefits and incentives for lenders who offer a free conveyancing and free valuation, as well as no product fees.
- What sort of factors can affect my buy to let remortgage?
When it comes to remortgaging your buy to let, lenders will assess you the same way as when you took out your previous or original mortgage, to ensure you can cover the repayments. They will look into the following stuff:
- Your income
- The amount of equity you have in your current property
- Your credit score
- The amount of buy to let properties you have, their value and any outstanding debt on them
- How much your buy to let mortgage repayments will be
You will need to consider these factors above and the sort of affect they can have on your remortgage.
Why Choose Starck Uberoi Solicitors?
No Hidden Costs
Our legal fees are fully transparent and come with no hidden costs. Our fees are presented to you in a comprehensive quote prior to instruction.
24/7 Progression of Your Case
Our online portal will track the progression of your case. You will have full access 24 hours a day, 7 days a week to your case online.
Lender Panels
We are trusted lender panel solicitors on the lender panels for the majority of high street lenders. View the full list of our mortgage lender panels.
Positive Feedback
We have overwhelmingly positive reviews on both Google and Trustpilot. Client satisfaction is our top priority.
CQS Accreditation
Our commitment to excellence is demonstrated by our accreditation to The Law Society’s, Conveyancing Quality Scheme.
SRA Regulated
We are regulated by the Solicitor’s Regulation Authority and are Law Society LEXCEL Accredited.
Convenience
Based in London and Canterbury we can communicate via face to face meetings, email, telephone or video call.
Property Network
We can recommend excellent Chartered Surveyors, financial and tax advisors to ensure a complete professional service.
