Multi Lease house - finance?

[Mooze]

We're looking at purchasing a house that has multiple leases (done by the room) - there have been no changes made to the house except for locks put on all doors.
My preferred lender (due to work related discounts) will only value it a the standard rent rate for the area (still very good) but also looking at getting a few more of these types of things.

Are there any lenders that will take into account the leases (four rooms) without having to go commercial?

 

[Peter_Tersteeg]

My preferred lender (due to work related discounts) will only value it a the standard rent rate for the area

If you want residential rates, then lenders will use residential returns. Operating a property on a per room basis is as much a business as it is an investment, hence lenders will usually want to assess them as a commercial property.

 

[tobe]

The only time you may be able to get a lender to use the higher rental is once its in your tax returns for a year or so. This also works where someone is renting out a room or two in their ppor. The lender wont use the lease on the room, until its in the tax return of the owner.

 

[Mooze]

Thanks guys.

 

[Mick C]

We're looking at purchasing a house that has multiple leases (done by the room) - there have been no changes made to the house except for locks put on all doors.
My preferred lender (due to work related discounts) will only value it a the standard rent rate for the area (still very good) but also looking at getting a few more of these types of things.

Are there any lenders that will take into account the leases (four rooms) without having to go commercial?

I wish this was true- because these sort of property will be a BARAGAIN buy! with the rental return.

Having said that: yes it's possible- there is only Three lenders i have dealt with that allows residental rate for muti-leased BUT:

1. You have to provide them with another residental home as "backup" security- 1st or 2nd mortgage is fine - and it must have a min equity of 30%

2. The muti-leased place must be council approved, through a R.Agent and also NOT "commerical zone" - res and mix ok.

3. Max 15 muti- leased. Any more case by case.

Regards
Michael

 

[Rolf Latham]

Hiya

Typically difficult to place, the issue isnt to much the accpetance of the rent, more so that the property as others have said may be on a comm basis.

We have had some success but not where the increasedrental income was needed

ta
rolf