Mortgage for House split in to 3 flats - HELP

[Iceboy74]

Hi,

I am looking at purchasing the above type of property and the interest rate I have been given by my mortgage advisor is 3.8% for a 5 year fixed.

Are these special mortgages....if I purchase a BTL single house or flat the rates are 2.2-2.9%.

The advisor tells me these are know as Multi Unit mortgages and have higher rates!

This is my first time in to multi-unit properties and I was not expecting higher rates!?

Help and advice much appreciated.

IceBoy

[theartfullodger]

Talk to other brokers specialising in BTL properties.

[loanarranger]

MUFB is on par with HMO’s , not every lender in the BtL sector accommodates such applications-so the rate as quoted is reasonably competitive. Suggest you ask your broker to provide a spreadsheet of his research thereby justifying this particular loan. If your borrowing is below 75% lower rates might be available.

[Gordon999]

What is the reason for wanting to buy a "multi-unit property" compared to buying a "single house" ?

The 5 year fixed mortgage interest rate for single house is available below 2% from some lenders . If you are chasing for higher income, I think a mortgage loan fixed for 5 years at 3.8% interest rate is not helpful and indicates it is not a good investment , but I could be wrong .

A good investment in property is about buying in the right location . Some wise guy has claimed the criteria for success property investment is "Location, Location, Location".

Is the "multi-unit property" in the right location ?

[Codger]

In order of importance when buying ..
capital growth
Good deal
Income vs cost

[Iceboy74]

The area is very good
The yield is great
The property fits my portfolio need

Yes the rates for financing are greater but it makes business sense.

IceBoy

[loanarranger]

May I suggest that you get your broker to reveal his research on products available , of equal importance is will the lender require an investment valuation or a straightforward Bricks & Mortar valuation , itis the former which you should have.
There are lower rates for a MUFB as lower as mid 3% Mark with a 2% completion fee or slightly higher but at No Completion Fee and below what your broker is quoting.
I’m sure this isn’t the case but is your broker quoting a Rate because the lender is paying a higher procuration fee ,I am sure he/ she isn’t doing such a dastardly action but always good to check why this rate is being cited.