It is not uncommon for mortgage brokers to avoid catering to the needs of limited companies.
This is mainly because it is not easy to find lenders in the market who can lend mortgage loan to limited companies and fulfil their requirements.
will usually see lenders who offer mortgage loans to those who have the strong financial background or have well-established businesses. Most small limited
companies get disheartened by this and come to the conclusion that they will
have to follow the personal borrowing route in order to get a loan.
However, this is not the case, even if you have a small limited company you can still get a mortgage. In fact you can avail mortgage loan even if you have just started your company, have an existing SPV Ltd company, have an existing trading Ltd company, going to start a new company at the time of taking out loan,
Ltd companies with personal guarantees, Ltd companies without personal guarantees, up to 85% loan to value and rental income need to be paid 125% of mortgage payment or have minor bad credit history.
The first thing that you need to do if you want to apply for remortgage loan or get a new property is finding a good broker who can advise you on how to better approach the lender with your ltd company.
An experienced and well-reputed broker would have done his extensive research in the market and would be already in touch with the lenders who easily provide mortgage loans to Ltd companies.
A common concept is that Ltd company lenders only provide loans to companies who purely do the business of property; however, there are some lending institutions who provide loans to Ltd companies who do other types of property related businesses as well.
SPV Ltd Company Lenders
There are various Ltd companies that only deal with rental property and they are called the Special Purpose Vehicle limited companies. They come under differing categories under the classification made by the lenders as per the Standard Industry Classification which is registered as the company house.
For this category, there are only special lenders who provide loans. You can approach them with the help of a specialist broker. The minimum amount that can be given in loan to this type of Ltd company is up to 85%. This rate can vary and discounts are also available but they need to be availed at the time of signing the deal.
Existing Trading Ltd Companies
Mortgage loans are also available to the existing trading ltd companies which do not deal in property business but other businesses. However, the deposit amount for such ltd companies is higher by up to 25%, it is mainly because the number of lenders is limited in the market.
Newly-made Ltd companies
And if you have just started your ltd company business then you will have to fill the application as an SPV and you will receive the loan on the basis of 85% loan to value as well as the capability of receiving the money from renting property.
Overall, it is not that difficult to get a mortgage loan if you are an Ltd company but you need to extensive research and get in touch with a well-reputed mortgage broker who can give you the best advice considering your situation.
Moreover, you also need to have good credit standing and give proof to the lenders of your creditworthiness, for example, you should have debts or should not have filed for bankruptcy in the recent times.
Most lenders closely monitor the credit history and make their decisions of giving or not giving the loan to the ltd company based solely on this.