Landlord Consolidates Debt for Easy Repayments on Mixed Property Portfolio

Property portfolios are a sound investment but are usually built over several years as new properties are acquired or developed. As a result, the majority of developers have multiple credit arrangements in place to cover their business and help them grow. Unfortunately, this can cause confusion which limits your ability to secure further credit or make decisions based on cashflow forecasting. 

For one of our clients, their portfolio was growing steadily but was comprised of many types of property. They had a number of assured shorthold tenancies, houses in multiple occupation (HMOs) and coastal commercial properties, all of which had individual mortgage agreements. 

The lender realised that having to repay each debt individually was not the most efficient way to manage their cash flow, but they also wanted to establish if the increased value of their portfolio could be used to secure a better credit offer than their existing agreements. With this in mind, they approached Rangwell for help. 

Why was there a problem?

Property portfolios consist of any number of properties which have their own credit agreements. In this case, the client had many buy-to-let mortgages, some commercial mortgages and some HMO properties, all with their own finance arrangements in place. 

This, in turn, meant the client had different repayment dates, terms and rates for each of their properties. This was not only a significant challenge for their general finances, but it also limited their ability to grow by complicating their cash flow position. 

The client did, however, have good rates comparatively – a common trend amongst portfolio landlords as lenders are often keen to work with experienced property experts. The client did not have to seek refinancing, but their prior experience in the industry allowed them to realise the need to explore their options. 

Why we were able to help

As previously mentioned, portfolio landlords tend to be a lender’s ideal client as they are low-risk and tend to take on high amounts of credit through large mortgage deals. However, most landlords don’t know the full extent to which refinancing can help them and have usually grown their business on a property-by-property basis, which means securing individual credit agreements each time. 

In this case, the client’s mixed portfolio offered significant value to a lender. Our relationship with market-leading lenders from high street banks and challenger banks alike means we were able to identify a lender who was happy to consolidate the client’s existing loans into a single credit facility. This new loan was a blended rate that took the LTV of each property into account. 

Doing so meant the client’s entire debt was moved into a single repayment across a 20-year term. The work they had done on upgrading their properties and securing tenants for them had increased their value, allowing the client to take money from the business and create a cash pot for future growth and for personal spending. 

Ultimately, refinancing resulted in the client consolidating their debts into a more manageable repayment plan, allowing them to free up cash and plan for further growth. 

Refinance your property portfolio 

If you’ve got a property portfolio of any size, you’ll likely have a range of different debts in place to cover them. Whether you are happy with your existing rate or not, why not explore the market in the same way you’d view a property investment? 

With Rangewell, you’ll get a team on your side to help you assess your portfolio’s value and then identify the best choices from across the lender’s market. With our help, you’ll be able to negotiate an agreement that consolidates all existing debts into a single repayment plan based on a blended rate offered against the most current value of your property as opposed to the value they had when you first purchased them.

Unlock the profitability of your portfolio and make your debts more manageable by refinancing your property portfolio with Rangwell today. Contact us to get started.