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Matt Brighton

20 | Purchasing My First Buy-To-Let (Progress)

published3 months ago
2 min read

Hello everyone! 👋
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The buy to let purchase is going slow at the moment! Having only just kicked off conveyancing, it's all ready thrown up a few hurdles to problem solve.
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To remind you of the figures on the Buy to Let I've just purchased:
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​Purchase Price: £106,000​
Refurb:
£9000​
Total Money In:
£41,950​
GDV:
£130,000​
Day 1 Profit:
£8500​
ROI:
20%
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The aim is to keep it for 2 years, if you include net rental profit, capital appreciation and the refurb uplift, I'm looking at a Return on Cost of about 62% meaning the £41k in, could return £26k profit in 2 years time hence why I'm not flipping this and instead tying up the funds in this hot market).

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🏡 Project One - Progress

Solicitors:​
There's been a few hurdles and hoops to jump through, the sellers solicitors are quite slow and even though the seller was keen to sell fast to minimise his own expenses on an empty home, he didn't engage with his solicitors earlier to get draft contracts drawn up so that side of things are slow

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Lending:
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On this project, the idea is to use a standard BTL mortgage as I should be able to refurb the project in about 4 - 6 weeks and I'm happy to tie up my cash. The mortgage application was all looking fine, then the chosen lender (Precise) have changed their appetite for holding companies, firstly they were unhappy with my company SIC codes, then later said they wouldn't lend to a company owned by a holding company which is frustrating as that's how mine is set up.

The lender is worried I could change owner which affects their security in the future so option A) is persuade the lender to underwrite a clause that I have to seek permission to change the owner of my holding company (Not that I'd ever need to) or B) swap lenders. I option A doesn't work out, we have a second option.

Refurb Planning
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I've been getting samples this week of flooring and drawing up better floorplans of the property ready to get going so when I do eventually complete and get the keys that all the prep work is already done. ​

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