DMI recently arranged a buy-to-let mortgage within an auction timescale with complex circumstances. Here’s what our client had to say:
“I approached DMI Finance and requested indicative finance terms for three complex properties which were listed in the SDL Bigwood Auction. This was my first purchase at auction and I was successful in the purchase of one of the Lots, exchanging contracts that day and making me legally bound to complete the purchase within a set timescale (28 days).
The property was a freehold multi-unit block consisting of three self-contained flats and DMI had already made me aware of several factors that would limit the finance options from the outset; particularly that it was adjacent to a hot-food takeaway. But they also recognised that the property appeared to be lettable immediately, so their focus was to obtain a long-term buy-to-let mortgage on day one, rather than rely on short-term bridging finance which would have been considerably more expensive.
DMI provided an outline of several options. I’d had a good chat with Andrew and the team and they worked very hard. I chose to proceed with Kent Reliance and within a week of the application being submitted the valuation was completed and returned to the lender.
But here was where DMI’s expertise really came into play.
Although the valuation was still awaiting lender assessment, Joe at DMI obtained a copy of the surveyor’s report and noted the surveyor had highlighted a couple of potential problems within the general remarks. In addition to the block being next to a hot food takeaway, one of the units was less than 30 sqm, which is a problem for most lenders. The concern was that the individual flat would have limited demand if sold on a separate long-leasehold title.
A further, completely unexpected issue was the discovery of a doorway on the ground floor leading into the adjacent hot-food takeaway, which was not actually part of my property. DMI Finance knew these would be a concern for any lender and in most cases lenders would have declined to give the mortgage.
Fortunately for me, DMI have direct access to senior underwriting teams, including at the lender we had approached for finance on this property. They approached them and offered potential solutions before the valuation had been assessed.
The underwriter was subsequently willing to continue with an application and the lender agreed that a special condition could be incorporated into the offer, allowing the doorway to be blocked up within 30 days of completion. The value of the smallest flat was also disregarded from the lenders calculations and DMI negotiated an increased loan-to-value ratio closer to our original request.
Ultimately, the borrowing costs were slightly higher than intended, but they allowed the borrowing to complete on the purchase within the required timescale on a standard BTL and without the need for a costly bridging finance.
I was extremely pleased to get a rate close to what I had originally envisaged and I am very grateful to DMI for making this possible. Their expertise not only enabled me to anticipate issues before they became problems, they were able to give me viable options going forward.
My first buy to let venture wasn’t without its hurdles, but thanks to DMI I feel confident that I could do it again, and I would have no hesitation in going back to DMI for their help.”
S Saliheen.
