Ltd Company Buy To Let Mortgages
Want to purchase property through your business? Then a Limited Company Buy To Let Mortgage may be the way to go…
Taking out a mortgage and investing in buy to let property through a limited company or SPV (Special Purpose Vehicle) may have you weighing up the pros and cons of this option. What is a Limited Company Buy To Let Mortgage anyway? Is a Limited Company Buy To Let Mortgage tax-efficient? Is a repayment mortgage a better option than an interest only mortgage, and what mortgage term will reap the most benefit? What about agreed term lending fees? If these questions have been playing on your mind, then it’s time Avail Mortgages got into the game. Our mortgage brokers will put your mind at ease, taking you through our range of mortgages, detailing the tax involved, and ensuring you get a suitable mortgage deal, and value for your business.
Our professional mortgage advisers understand the complexities of the limited company buy to let mortgage arena, and can simplify the mortgage process, and guide you through it. Our mortgage advisers and mortgage brokers are committed to client care and customer service, as highlighted by our fantastic reviews and testimonials. Aided by our state-of-the-art technology – which includes our mortgage calculator and our client portal – we ensure the mortgage process is quick, easy and efficient. To find mortgage deals for your business, please do not hesitate to get in touch with us today. We provide Limited Company Buy To Let Mortgages to business owners and company directors in areas such as Leeds, Huddersfield, Bradford, York, Harrogate as well as the rest of the UK, so we know that we can help you too.
What is a Limited Company Buy To Let Mortgage?
If you’d like to purchase a property through a limited company, then you’ll need a Limited Company Buy To Let Mortgage, as opposed to a normal residential mortgage. Instead of owning the property yourself, the company will own it. In fact, you can set up a company specifically for this purpose – i.e. to buy investment properties.* A company set up for this reason is called a special purpose vehicle (SPV), and can be a lucrative way to build upon your property investment portfolio.
After setting up a property company for buy to let, you pay money into the company. This is used as a deposit on properties you buy and the rest of the purchase price will be covered by a limited company buy to let mortgage.
An important thing to note is that there are different tax rules when you buy property in your own name, as compared to when you buy property through a limited company. If you invest in buy to let property in your own name, as a rough guide you may have to pay:
- Capital Gains Tax if you make a profit when you sell the property*.
- Stamp Duty Tax*.
- Tax on your rental income*.
Please note though that we are not tax advisors – clients looking for this type of mortgage should also seek the advice of a tax specialist.
Limited Company Buy To Let Mortgages
Along with tax implications, you also need to decide on the type of Limited Company Buy To Let Mortgage that you would like. There are various mortgage options available, and here at Avail Mortgage Brokers, we can help you choose between:
- A fixed mortgage rate*, variable mortgage rate* or a tracker mortgage rate*.
- An interest only mortgage* or repayment mortgage*.
- A longer mortgage term or a shorter mortgage term. A longer mortgage term may mean your monthly mortgage repayments are lower, but a short mortgage term may end up saving you money in the long term.
If you’re looking for a Limited Company Buy To Let Mortgage in Leeds or the surrounding areas including Huddersfield, Bradford, York or Harrogate, then please get in touch with our mortgage brokers today. Taking property income and private finance into account – as well as individual circumstances – our mortgage brokers will provide you with a mortgage, a professional service and a variety of mortgage deals that will make it simple to choose.
Income Requirements For Limited Company Buy To Let Mortgages
One question we are regularly asked here at Avail Mortgages is, ‘’What income does a limited company need to qualify for a buy to let mortgage?’’ It’s a good question, and though it does vary dependent on the business, industry and growth stage, the following mortgage guidance will help:
- New Special Purpose Vehicles (SPVs): Because the company is new, there will be no income to show to a lender.
- Established SPVs: For more established SPVs, you will need to provide 2 years worth of healthy accounts. Some mortgage lenders will accept accounts kept by the applicant rather than a formal accountant since the SPV does not “trade”, but they should still appear healthy (the accounts, and the applicant!).
- Trading Limited Companies: If you are looking to apply for a mortgage via a Trading Limited company, most lenders will need to see 2 years of strong accounts which show an income level of £25k – £80k+. However, there are some mortgage lenders that will lend if a taxable income can be proven, regardless of the amount.
- Personal Guarantees: In some cases, mortgage lenders require business directors to provide a personal guarantee – who will be liable for any money owed should the mortgage lender have to repossess your property.
Limited Company Buy To Let Mortgages: What Should I Know?
Benefits of Limited Company Buy To Let Mortgages Include:
- It can be easier to transfer a limited company to another owner rather than transfer a privately held property. This could protect the transaction from Stamp Duty Tax, Inheritance Tax* and Capital Gains Tax.
- Retaining profits in a limited company helps avoid a capital gain as, instead, your business is making a profit.
- If you own a limited liability company you’re not personally liable for the company’s debts, although, you may still need to provide a personal guarantee to a mortgage lender.
Things To Note About Limited Company Buy To Let Mortgages
- No Capital Gains Tax allowance applies when a limited company sells a property.
- There are additional costs related to running a limited company. These include: the preparation of accounts (a legal requirement), Corporation Tax, filing at Companies House, legal fees and annual auditing if applicable.
- As always, we’ll be honest. Most mortgage lenders do charge a slightly higher mortgage interest rate and higher fees when it comes to Limited Company Buy To Let Mortgages, as compared to individual buy to let mortgages.
Weighing up the pros and the cons in relation to your business, here at Avail Mortgages, our mortgage brokers will always provide you with expert advice and Buy to Let Limited Company Mortgage deals.
Get In Touch
What is a Limited Company Buy To Let Mortgage? Should I choose a variable rate mortgage, fixed rate mortgage or tracker rate mortgage? What are the pros and cons of a repayment mortgage and interest only mortgage? If you’re looking for a mortgage broker who can answer all of your mortgage questions and more, while also offering you suitable Buy to Let Limited Company Mortgage loans, then look no further than Avail Mortgage Brokers. Our mortgage brokers provide mortgage guidance and mortgage support to those seeking mortgage services across Leeds and the surrounding areas including York, Bradford, Sheffield, Harrogate and Huddersfield and will always put your best interests first. It’s therefore in your best interest to speak to us too.