Typically a portfolio landlord is someone with 4 or more mortgaged buy-to-let properties, whether they’re owned privately or under a limited company.
What is a portfolio mortgage and how does it work?
This type of mortgage works by placing all of your property mortgages under an umbrella mortgage lender, whether you have 4 or 15 rental properties with mortgages.
By having one umbrella lender and treating it as one account you’ll have one monthly payment. This can benefit you because it will:
- Simplify your landlord finances.
- Make it more tax efficient.
- Boost borrowing power.
There are a variety of portfolio mortgage lenders, including some high street lenders. However, they all have their own criteria that must be met.
You will need to provide the same information as a normal buy-to-let mortgage application so that lenders can carry out stress tests. However, you will be required to provide further documentation such as:
- A detailed schedule of properties
- A business plan
As regulations on buy-to-lets became stricter in September 2017, lenders will ensure that you are not over-committing yourself and have enough contingency in place to cover any eventualities.
That being said, as long as you meet criteria there is no legal limit to the number of properties you can have in your portfolio.
However, lenders will look to minimise their risk by placing their own limits on the number of mortgaged properties they will allow, and the overall maximum amounts you can borrow.
Getting professional advice from a specialist advisor or broker will be important to your application as it is a ‘niche’ area.
Get in touch with us at the Online Mortgage Guru and we’d be happy to put you in touch with an experienced advisor who has the expertise in this area and works within the entire buy-to-let market.