LIMITED COMPANY MORTGAGES

You will require a mortgage to finance your home bid unless you are a cash buyer. The first step to securing a mortgage before attending an auction is to speak to a lender and find out what type of mortgage, they can offer you. Here at ams: we can act as an intermediary; we have access to a portfolio of lenders and will find the best lender for your needs.

In the UK, a limited company mortgage is a financing solution for property investment that enables businesses to obtain assets through a distinct legal entity. This type of mortgage is gaining popularity as investors look to boost their returns while reducing their risks. It helps safeguard personal assets and enhances tax-efficiency.

Limited company mortgages offer investors the opportunity to access higher loan amounts, enjoy reduced interest rates, and benefit from potential tax advantages. Here at ams: we have substantial experience with these mortgages, contact us for advice and guidance.

Eligibility criteria for a limited company mortgage in the UK will differ from lender to lender, but typically requires the company to be registered in the UK and possess a good credit record.

The property being bought must be a viable investment property, and the directors of the company may need to furnish personal guarantees. Evidence of income, property investment experience, and a minimum deposit of 20% of the property's value may also be necessary.

The list below are just some of the advantages of ltd company director mortgages:

• Access to larger loan amounts - they allow you to borrow larger amounts of money than personal buy to let mortgages
• Asset protection - by owning property through a limited company, your personal assets are safeguarded in the event of financial difficulties related to the property
• Flexibility - they can be structured to provide flexibility in terms of ownership and tax planning, enabling you to tailor the arrangement to your specific requirements
• Lower interest rates – ltd company director mortgages offer lower interest rates than personal buy to let mortgages
• Professional image - owning property through a limited company can project a professional image to potential clients and business partners

Tax-efficiency - limited company mortgages can offer greater tax-efficiency compared to personal buy to let mortgages. For instance, interest payments on a limited company mortgage can be claimed as an expense, which can decrease your tax liability

Limited company mortgages in the UK can be used to finance distinct types of investment properties, including:

• Residential buy to let properties - these are properties that are rented out to tenants, such as flats or houses
• Commercial properties - these include shops, offices, warehouses, and other non-residential properties that generate income
• Houses of multiple occupation (HMOs) - these are properties that are rented out to multiple tenants who share communal areas like kitchens and bathrooms
• Student accommodation - this includes properties that are rented out to students, such as purpose-built student accommodation or shared houses
• Mixed-use properties - these are properties that combine residential and commercial use, such as a property that has a shop on the ground floor and flats above

Irrespective, of the type of property you are looking to buy, speak to us at ams: and we can assist in obtaining top-quality mortgages for company directors.

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A limited company buy to let mortgage can help safeguard your personal assets if the property encounters financial issues. When the property is owned by the limited company, your personal assets are shielded from the risks associated with rental arrears, non-rental periods (i.e., no tenant or during refurbishments), or property maintenance costs.

Conversely, if an individual owns the property, their personal assets could be exposed to such financial difficulties. By opting for a limited company mortgage, your liability is limited to the amount invested in the company.

It is worth noting though that some lenders may demand personal guarantees from the directors of the limited company. This means that under certain circumstances, personal assets could still be at risk if the company fails to meet the mortgage repayments.

Typically, there are no set restrictions on the number of investment properties that can be financed with a limited company buy to let mortgage in the UK. Lenders may establish their own criteria though and limit the number of properties that can be funded with a single mortgage.

However, financing multiple properties through a limited company buy to let mortgage can be intricate and require a more advanced level of financial expertise and management. Speak to us at ams: we are experienced mortgage brokers and will provide all the support and assistance you need to obtain mortgages for company directors.

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Switching from a personal buy to let mortgage to a limited company buy to let mortgage in the UK is possible, but it can be a complex process that depends on individual circumstances and the terms of the existing mortgage. Before considering the switch, it is important to evaluate the tax implications of transferring the property from personal ownership to a limited company and consult with a qualified professional to ensure that the switch is financially beneficial.

To switch to a limited company, buy to let mortgage, you will typically need to refinance the existing mortgage and transfer the property into the name of the limited company. This may require paying early redemption charges on the current mortgage and incurring additional fees related to the transfer of ownership.

If we can’t help, then it’s not possible!